BEIJING, June 26 Reuters China39;s capital city Beijing announced steps on Wednesday to reduce the cost of buying a home, including cutting mortgage interest rates and the minimum downpayment ratio, to try to boost the local property market.

The moves, announced in a local government statement, come after the central bank issued new guidelines on reducing minimum mortgage rates and downpayments last month, which sparked dozens of cities to relax property policies.

Beijing is lowering the minimum downpayment ratio for buying a home to 20 from 30, and for some second home buyers to 35 from 40, the statement said.

The city is also reducing the floor rate for a firsthome mortgage to the loan prime rate LPR minus 45 basis points. Previously, the floor was the LPR plus 10 basis points.

Beijing39;s moves mean that China39;s four biggest cities have now relaxed mortgage and other policies that should help boost demand from home buyers, said analyst Yan Yuejin at EHouse China Research and Development Institution.

China39;s ailing property market has been a big drag on the world39;s secondlargest economy.

Reporting by Liangping Gao and Beijing newsroom; Editing by Mark Potter

Source Reuters