(Sept 29): China will subsidise mortgage interest payments for first-time homebuyers nationwide, as policymakers step up efforts to revive the housing market amid a prolonged property downturn and slowing economic growth.

First-home buyers will get subsidies worth an annualised rate of one percentage point of the mortgage principal, according to a Ministry of Finance statement late Tuesday. To qualify, homes must be 120 square meters or smaller and priced at 1.5 million yuan (US$224,000 or RM913,337) or less.

China’s years-long housing slump, with new-home prices falling for more than three years straight, has been a major drag on the economy. The country’s growth has likely weakened further below the bottom end of the government’s annual target in the third quarter after reaching 4.3% in the previous three months, with consumption flatlining and investment falling into a deeper slump.

In late September, China’s cabinet promised to introduce new measures to support the economy and study policies to stabilise the reeling property market, saying it will “put in place a package of practical and effective additional policies” to safeguard this year’s economic goals.

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