Value of personal housing loans in Shanghai 2001-2021

In 2021, the total value of personal housing loans in Shanghai exceeded 1.67 trillion yuan, representing a growth of around eight percent from the previous year. With the city’s housing market being incredibly competitive in the past two decades, the total value of mortgage loans in the city has increased by more than 24 times since the turn of the century.

A competitive housing market

As the economic capital of China, Shanghai has long been attractive to talents throughout the country, resulting in strong growth in its population. Since the housing reform in the 1990s, the price of homes in Shanghai has risen continuously, with housing in the city’s center becoming one of the most expensive in the world.

High mortgage rates

The increase in prices fueled intense speculations in the city’s housing market, with many residents resorting to mortgages to get on the housing ladder. Although the average mortgage rate in Shanghai is one of the lowest in China, it is still far higher than that in most other major economies. The consistent rise of the total mortgage value in Shanghai can potentially harm the financial security of the country and the region.