Brace yourself for rising mortgage rates

As 4 banks have already raised their rates by 25bps.

According to Nomura, since last week’s warning signs, four banks have officially raised their mortgage rates by 25bps. 

These include HSBC, Standard Chartered, Hang Seng Bank, and BEA. With the mortgage rate hike compounding the impact from the earlier doubling of stamp duties, secondary transactions have remained “frozen”.

Here's more from Nomura:

Although home prices have held firm over the past few weeks, we see a period of weakness ahead and reiterate our view that the 5.4% YTD gain will be returned over the remainder of 2013.  

Hong Kong’s three-month interbank stayed at 0.38%, while Libor remained unchanged at 0.28%. One positive last week was the correction of 10-year US Treasury yields, which fell 6bps to 1.99% and eased the gain from the previous week.  

After last week’s warning that mortgage rates may be on the way up, four banks have officially raised their mortgage rates. HSBC and Standard Chartered announced that effective on 14 March 2013, they will raise their mortgage rates for new mortgages by 25bps.

For HSBC, the 25bp increase lifts the effective mortgage rate to 2.85-3.15% for prime-based mortgages and to Hibor + 2.55-2.95% for Hibor-based mortgages.

For Standard Chartered, its effective prime-based mortgage rate increases to 3.1-3.5%, while its Hibor-based mortgage rate increases to Hibor + 2.75-3.25%. Subsequently, Hang Seng Bank also raised its mortgage rates by 25bps on 14 March 2013, while Bank of East Asia raised its mortgage rate by 25bps on 19 March 2013 (Source: SCMP & HKET 14 March 2013)