Residential mortgage loans in negative equity: End of December 2024
The Hong Kong Monetary Authority announced today (28 January) the
results of its survey on residential mortgage loans (RMLs) in negative
equity at end-December 2024.
The estimated number of RMLs in
negative equity was 38,389 cases at end-December 2024, as compared to
40,713 cases at end-September 2024. These cases were mainly related to
bank staff housing loans or RMLs under mortgage insurance programme,
which generally have a higher loan-to-value ratio.
The
aggregate value of RMLs in negative equity decreased to HK$195. 1
billion at end-December 2024 compared with HK$207. 5 billion at end-
September 2024.
The unsecured portion of these loans
decreased to HK$14. 5 billion at end-December 2024 from HK$15. 8
billion at end-September 2024.
The three-month delinquency
ratio of RMLs in negative equity remained at a low level of 0. 15% at
end-December 2024 as compared to 0. 13% at end-September 2024.
It is important to note that the figures derived from this
survey relate only to RMLs provided by authorized institutions on the
basis of first mortgages and which the reporting institution knows to
be in negative equity (i. e. the outstanding loan amount with the
reporting institution exceeds the current market value of the
mortgaged property). Not included in these figures are RMLs associated
with co-financing schemes which would be in negative equity if the
second mortgages were taken into account. The extent to which such
RMLs are in negative equity is not known because authorized
institutions do not maintain records on the outstanding balances of
the second mortgages.
The mortgage portfolios of the surveyed
authorized institutions represent about 99% of the industry total. The
survey results have been extrapolated to estimate the position of the
banking sector as a whole.
Annex Hong Kong Monetary Authority
28 January 2025