You are here: Home > Video > Breaking News > China

Adjust font size:

With the heating-up of China's property market, pawnshops around the country have increased rates for real estate by as much as 30 percent. This is the first major rate hike since the rebound in the market. And the move has directly pushed up property pawn businesses.

China's red-hot property market has given pawn shop business a boost. Major pawnshops in Beijing have raised rates for real estate from 20 to 30 percent over a year earlier.

Pawnshops say since November, the demands for capital by small and medium-sized companies has increased significantly. Many have chosen to finance through housing pawn.

One pawnshop consumer said "Our company is now in urgent need of funds. It's too complicated to get bank loans. While pawnshops have raised property rates, I can get 300-thousand yuan more by pawning."

Li Chunhua, Manager of Beijing Huaxia Pawnshop Company said "Recently, our property pawn businesses have boomed. Telephone consultation volume alone this month increased as much as 30 percent from the same period of October. While property pawn funds also surged about 45 percent from last month."

Industry figures show that for the third quarter of this year, Beijing's property pawn business totaled 910 million yuan, up around 24 percent from a year earlier.

The number of pawnshops began to increase rapidly after the end of 2007, when the global financial crisis worsened. Last year, pawnshops nationwide adjusted down property pawn rates due to the gloomy housing market. Despite the rate hike, industry insiders say pawnshops are still prudent over medium and long-term property financing, as the current rate hike mainly targets short-term mortgages.