The National Financial Regulatory Administration has recently issued five trial measures covering development loans for commercial housing, individual housing loans, commercial real estate loans, urban renewal project loans, and real estate trust business by trust companies. Officials from the relevant departments have responded to media questions regarding these new regulations.

Background and Context of the New Regulations

The measures are designed to implement the decisions of the Party Central Committee and the State Council, building upon a comprehensive review of existing real estate financial policies. The Administration has aligned these rules with the current property market situation and future development direction, coordinating with the institutional frameworks led by the Ministry of Housing and Urban-Rural Development and the People's Bank of China. The new regulations clarify management requirements across key areas including development loans, personal housing loans, commercial real estate loans, urban renewal financing, and trust business in the property sector. Together, they aim to establish a financing system suited to the new development model for real estate, protect homebuyers' legitimate rights, satisfy reasonable financing needs in the sector, and promote high-quality industry growth.

Supporting Reasonable Financing for Housing Development Projects

The measures for commercial housing development loans guide banking institutions to operate on market-oriented and law-based principles, using a project-centered approach with a lead bank model to meet reasonable financing demands. The regulations require banks to distinguish between risks at the enterprise group level and those specific to individual projects, with loan approval processes placing greater emphasis on the project itself. Projects must maintain separate accounting records, with independent fund operation under closed management to effectively prevent delivery risks and credit exposure.

The rules set differentiated loan term requirements that align with the construction and sales cycles of pre-sale and existing-property projects, while moderately extending maturities for completed-property developments. The measures integrate with the "whitelist" mechanism, meaning projects financed under these regulations will be included in whitelist management, thereby extending policy benefits to a broader range of housing development initiatives.

Addressing Rigid and Improved Housing Demand

To support the reform of commercial housing sales systems and facilitate the construction of a new real estate development model, the National Financial Regulatory Administration has collaborated with the People's Bank of China to formulate the individual housing loan measures. These are consistent with the jointly issued opinion on reforming and improving real estate credit management to accelerate the establishment of a new development model. Banking institutions are guided to support both rigid and improved housing demand while protecting buyer interests.

From a safety perspective, the timing for disbursing individual housing loans for pre-sold properties has been adjusted from the point of structural topping-out to the stage of completion filing, with enhanced risk management throughout the lending process. This change fundamentally safeguards homebuyer rights. In terms of accessibility, the measures optimize the upper limits for debt-to-income ratios and extend maximum loan tenors, reasonably improving borrowers' capacity to obtain financing and offering more mortgage options.

From an economic standpoint, convenience arrangements have been introduced for second-hand housing transactions, including the ability to complete transfers while existing mortgages remain in place. This helps reduce transaction costs and better meet improved housing needs. Additionally, banking institutions are required to strengthen oversight of third-party cooperation agencies to prevent illegal loan intermediaries from harming consumer interests.

Commercial Real Estate Loan Framework

The commercial real estate loan measures have been developed to promote standardized growth in this segment and support the stable and orderly operation of the commercial property market. The regulations clarify the definition and scope of commercial real estate loans, introduce the lead bank system, project-based management, and closed-funding arrangements, while requiring banks to establish robust management mechanisms for identifying, assessing, monitoring, controlling, and mitigating risks in compliance with regulations.

Recognizing that funding needs and repayment sources differ across the development, acquisition, and operation phases, the measures categorize commercial real estate loans into three stages. Detailed requirements are specified for each phase regarding loan use, term structure, customer and project admission criteria, and credit management, ensuring the financing framework is appropriately aligned with market demands. Transitional arrangements allow operating property loans to continue following existing notification requirements.

Financial Support for Urban Renewal Initiatives

Working with the Ministry of Housing and Urban-Rural Development, the Administration has introduced measures for urban renewal project loans to implement the central government's decisions on high-quality urban renewal. The regulations establish fundamental principles for financial institutions conducting such lending, with detailed specifications on admission conditions, permissible loan uses, repayment sources, and fund management.

Institutions are guided to establish a dedicated "urban renewal project loan" product category, with reasonable determinations of loan amounts, tenors, interest rates, and collateral arrangements to enhance the precision, adaptability, and effectiveness of financial services in this area. Furthermore, institutions are encouraged to leverage their unique strengths and design comprehensive financial service programs tailored to project characteristics, thereby strengthening support for urban renewal initiatives while maintaining appropriate risk controls.

Aims and Details of Trust Business Regulations

The trust company measures adhere to principles of serving the real economy, maintaining controlled risk, and implementing investor suitability requirements. Trust companies are instructed to follow market-oriented and law-based approaches, leverage their distinctive advantages, strengthen professional capabilities, and enhance the adaptability, compliance, and sustainability of trust services. The rules require equal treatment for projects across enterprises of all ownership types, promoting diversified financial service channels suited to the new real estate development model.

These measures aim to improve the precision and adaptability of trust services in connecting with real estate projects, emphasizing a project-centered approach, innovative application of the lead bank model, and further improvements in closed fund management. Strong emphasis is placed on protecting investor legitimate rights and interests. The regulations also guide trust companies to develop management systems aligned with the characteristics of the real estate sector, fulfill trustee duties, and raise service standards. Clear definitions are provided for the scope, classification, and business principles applicable to real estate-related trust activities. For asset management trusts, detailed requirements address enhanced independent due diligence, centralized decision-making, and project management, with specific provisions for investments in non-standard assets. For asset service trusts, requirements focus on the legality of trust purposes, authenticity of property, and clarity of rights and obligations.