BEIJING, (Reuters) – Banks across nearly 90 Chinese cities reduced mortgage rates in February in a bid for increased sales in a chilled residential property market. This was in response to a long-running liquidity crunch that many developers have been experiencing.

Beike Research Institute surveyed mortgage rates in 87 cities. There were 103, and 30, of those cities included Beijing. These cuts averaged 5 basis points. They are in line with an equal decline in the 5-year Loan Prime Rates (LPR) in January.

After two rounds in which the LPR of the benchmark was cut by the central banks in December, and January respectively, commercial lenders reduced mortgage rates to support slowing growth.

“Mortgage Rates in Beijing and Shanghai dropped for the first month-on-month after mid-2020,” stated Xu Xiaole (an analyst at the institute), adding that there were more cuts.

According to Reuters, the four largest banks in China lowered their mortgage rates by 20 basis point Monday in Guangzhou.

According to the Beijing-based institute, mortgage rates for smaller cities like Hohhot and Zhongshan were reduced by 30 basis points.

Pinpoint Asset Management’s chief economist Zhiwei Zhang stated that “this change in policy doesn’t mean the government has abandoned the long-term goal of houses are for people to live, not for speculation”.

Zhang stated that once growth stabilizes in the second quarter and important meetings with the government end in the fourth-quarter, then the focus will shift to the longer-term goal.

Late in the year, the Communist Party will hold its only-in-five years congress.

Authorities have been taking a variety of steps since late 2021 to avoid a difficult landing in the property sector. These include support for newlywed couples and buyers.

Some banks began to request smaller down payments last week in some cities that are not restricted by regulations on purchasing.

A Reuters inquiry for comments to the People’s Bank of China was not answered immediately by them.

China’s home prices increased in January for the first-time since September, according to official data. Partly due to better demand in China’s largest cities,