“It’s a frontrunner among policies used to support the housing market,” said Chen Wenjing, a research director at China Index Holdings Ltd. “The housing market has seen lingering pressure, and many local governments have leveraged this policy to reduce the mortgage burden.”
China is tapping an often overlooked pool of funds worth 10.9 trillion yuan ($1.95 trillion) to salvage its housing sector, offering people an alternative to bank mortgages.
The housing provident fund, a government savings programme used to help people buy homes, has become an increasingly important means to obtain financing, as banks turn more cautious with profit challenges. The fund has outpaced banks in giving out loans, hitting 8.1 trillion yuan in outstanding mortgages last year.
