Four of China’s largest state-owned banks—China Construction Bank Corp, Bank of China, Agricultural Bank of China, and Industrial and Commercial Bank of China—announced Saturday plans to reduce existing mortgage rates effective 25 October.

The banks will cut rates by at least 30 basis points below the benchmark Loan Prime Rate, following government directives aimed at revitalizing the country’s sluggish economy, especially the struggling property market.

This decision arises from China’s economic challenges, marked by weak domestic demand, trade tensions, and previous COVID-19 lockdowns impacting real estate.

The central bank’s directive to reduce mortgage burdens on homeowners reflects a need to stimulate consumer confidence and economic activity given the disappointing growth figures.

The mortgage rate cuts are poised to enhance home affordability, likely spurring new property purchases.