China has unveiled its biggest stimulus package since September 2024, combining mortgage subsidies with expanded central bank lending to revive a faltering economy. The measures were announced on September 30, after markets closed ahead of the Golden Week holiday.

The Ministry of Finance will subsidise 1 percentage point of annual mortgage interest for up to five years for eligible first-time homebuyers. Loans up to 1 million yuan qualify, for homes under 120 square metres valued below 1.5 million yuan. It is China’s first nationwide mortgage interest subsidy.

The People’s Bank of China cut its pledged supplementary lending rate by 25 basis points to 1.5 percent and raised relending quotas: 200 billion yuan more for tech innovation, 500 billion for agriculture and small firms.

The package aims to secure the 4.5 to 5 percent annual growth target after second-quarter growth slipped to 4.3 percent. But investors were underwhelmed: the CSI300 rose just 0.2 percent while the property index fell nearly 7 percent, as analysts said demand weakness remains unaddressed.