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Hong Kong Reports Decrease in Negative Equity Residential Mortgages by Mid-2025
The Hong Kong Monetary Authority (HKMA) has recently released its findings on residential mortgage loans (RMLs) in negative equity, highlighting a decrease in such cases by the end of June 2025. According to the report, the number of RMLs in negative equity stood at 37,806 cases, representing a decline from 40,741 cases recorded at the end of March 2025.
The data indicates that this reduction is primarily attributed to bank staff housing loans and mortgage insurance program loans, which typically bear a higher loan-to-value ratio. The total value of RMLs in negative equity was reported at HK$190.2 billion by the end of June, marking a decline from HK$205.9 billion in March.
A notable trend observed is a reduction in unsecured loans, with figures decreasing from HK$16.4 billion at the end of March to HK$14.3 billion by the end of June. However, it is worth noting that the three-month delinquency ratio of RMLs in negative equity saw a slight increase, rising to 0.21% from 0.17%.
The survey, which covers RMLs provided by authorized institutions based on first mortgages known to be in negative equity, excludes loans associated with co-financing schemes that might also be in negative equity if second mortgages were considered. The extent of negative equity in such cases remains undetermined, as financial institutions do not maintain records of second mortgage balances.
The comprehensive survey provides valuable insights into the state of the residential mortgage market in Hong Kong.
Source: Blockchain.News
