business, property financing, property policies, hong kong property, banking & finance, business of climate change, climate change, hong kong housing, bank of china, the bank of china, bank of china dangles cash reward for going green with mortgages for sustainable housing

Bank of China (Hong Kong), the largest provider of financing for completed homes in the city, is teaming up with developers to offer cash rewards to mortgage applicants in residential developments with “green credentials.”

The local unit of China’s third-largest banking group has lined up several projects from 10 developers so far under its so-called Green Mortgage Plan to promote sustainable development, according to its website. Almost 2,300 units are still available for sale in those projects, according to data compiled by real-estate agency 28Hse.

“We are working closely with other developers and look forward to extending the plan to more certified green developments to promote the transition to a low-carbon and sustainable economy,” said Florence Chan, deputy general manager in the personal digital banking product department. “The market response has been positive.”

The bank first launched the mortgage plan earlier this month in a tie-up with Sino Land Company, dangling a cash reward of HK$6,888 (US$886) to successful homebuyers and mortgage applicants until the end of the year.

business, property financing, property policies, hong kong property, banking & finance, business of climate change, climate change, hong kong housing, bank of china, the bank of china, bank of china dangles cash reward for going green with mortgages for sustainable housing

The market response has been positive, says Chan of Bank of China (Hong Kong). Photo: SCMP

The scheme aims to generate savings in the form of 900 pieces of paper for each approval, the lender estimates. That is equivalent to 0.02 tonnes of carbon emission reduction in a paperless and digitalised process.

The cash incentive, however, applies only to energy-efficient properties that are assessed by Beam Plus, which provides independent assessments of sustainability performance, as well as those vetted by Hong Kong Green Building Council. There are about 200 residential projects certified as Platinum or Gold by the council at the end of August.

The projects in the sustainability drive include Sino Land’s Silversands, One Soho and Grand Central co-developed by Urban Renewal Authority (URA), Wheelock Properties’s Koko Hills (Phase 1), and Henderson Land’s The Henley (Phase 1 and 3) and Two Artlane.

Other participating developers include RK Properties, Ping An Real Estate and MTR Corp, Chinese Estates Holdings, K Wah International, Shimao Property and SEA Group.

“Feedback on the plan has been positive,” said Thomas Tang, executive director and group chief financial officer of Sino Group. “We look forward to expanding the portfolio of projects eligible for the plan, and increasing collaborations with our partners in all markets.”

Buyers of The Henley units who successfully applied for green financing from the Bank of China unit could experience paperless and digital mortgage services, Henderson Land said. It dovetails the developer’s sustainability strategy to build a green future, it added.

As the green mortgage plan involves cooperation with different developers and an investment in online financial technology, other banks will monitor the market reaction before entering the fray too, according to mReferral Mortgage Brokerage Services.

“It will take at least a few years, say two to five years, for the plan to gain popularity in Hong Kong,” said Eric Tso, chief vice-president at mReferral, which has partnered with nine banks to drive mortgage applications online.

As a large bank in Hong Kong, the Bank of China is setting a good example for other lenders to follow, he added.

Hang Seng Bank also “attaches great importance” to ESG initiatives, a spokeswoman said, having launched an online platform with information submission and documents upload for home mortgage applications.

The bank, a subsidiary of HSBC, has also worked closely with various property developers, real-estate agents and mortgage brokers to offer instant property valuations and solutions to deliver convenient and seamless services to homeowners.

“The bank will continue to optimise its mortgage services with the latest technology to meet evolving customer needs,” she added.

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