Chinese homebuyers see mortgage rates fall to a record three percent

The cost of borrowing

The People’s Bank of China recorded a weighted average interest rate for personal housing loans of 3.06 percent in March 2026. This represents a decline of 0.07 percentage points from the same period last year. Corporate borrowers are seeing similarly low costs, with the weighted average rate for new enterprise loans falling to 3.05 percent. The People’s Bank of China implemented a moderately loose monetary policy to maintain ample liquidity and push comprehensive financing costs to historic lows.

The market response

Despite the cheaper cost of capital, the property market has not yet stabilized. First-quarter real estate development investment fell by 11.2 percent compared to the previous year. Sales figures reflect a similar contraction, as national sales of newly built commercial properties dropped by 16.7 percent to 1.73 trillion yuan. The total volume of residential floor space sold also declined by 13.1 percent to 160 million square meters.

Outstanding household loans stood at 83.56 trillion yuan at the end of March, representing a slight 0.4 percent year-on-year contraction. This indicates that households are not expanding their mortgage debt despite the lower rates.

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Source institutions：People’s Bank of China

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