China Announces Rate Cut and Mortgage Subsidies to Boost Economy

China cuts interest rates and introduces mortgage subsidies to boost growth and property sector. Key measures aim to support housing demand and economic targ...

Editorial Desk

September 29, 2026 One Min Read

POLICY WIRE — Beijing, China — China introduced a series of economic stimulus measures on Tuesday, including a reduction in key interest rates and new mortgage support for first-time homebuyers, as part of efforts to stabilize its slowing economy and revitalize the real estate market.

The People’s Bank of China lowered the rate for its pledged supplementary lending facility (PSL) by 0.25 percentage points, bringing it down to 1.5%. This move is intended to encourage banks to provide more affordable financing for public and state-backed projects. The central bank also increased the relending quota for technological innovation by 200 billion yuan, raising the total to 1.4 trillion yuan.

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In addition, the Ministry of Finance announced mortgage interest subsidies for eligible first-time homebuyers starting in October. These buyers will receive an annualized 1% subsidy on their mortgage principal for up to five years, provided the property is under 120 square meters and priced at no more than 1.5 million yuan. Analysts suggest these steps are aimed at supporting lower-tier cities where the housing market remains weak and economic growth has slowed.

Reporting by Policy-Wire (PW)

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