MUFG Bank raises MAR preferred floating mortgage rate to 0.945%

MUFG Bank raises MAR preferred floating mortgage rate to 0.945%

MUFG Bank Adjusts Floating Mortgage Rates Amid Bank of Japan Hike
February 27, 2026

Mitsubishi UFJ Financial Group Inc. (MUFG), Japan’s largest bank, announced adjustments to its floating mortgage rates following the Bank of Japan’s (BOJ) interest-rate hike in July 2024—the central bank’s first increase in nearly two decades according to Bloomberg. While MUFG did not explicitly reference a “MAR preferred” rate of 0.945%, the bank confirmed a rise in its short-term prime rate, a key benchmark for personal mortgages. Effective September 2, 2024, MUFG increased its short-term prime rate by 0.15 percentage points to 1.625%, marking the first adjustment since 2007.

Floating-rate mortgages in Japan, which constitute approximately 75% of personal loans, are typically tied to banks’ prime rates and adjusted based on borrowers’ credit profiles. MUFG currently offers floating mortgage rates as low as 0.345%, but the prime rate hike signals a shift toward higher borrowing costs for new homebuyers. Analysts note that the move could temper an already sluggish housing market, particularly in Tokyo, where rising condo prices have been driven by weak yen, labor shortages, and limited supply according to Bloomberg.

The rate adjustment has already impacted real estate stocks, with leading developers like Mitsui Fudosan and Mitsubishi Estate experiencing intraday declines of up to 9.4% in August 2024. However, existing homeowners may see delayed effects due to Japan’s five-year adjustment rule for monthly mortgage payments. While total interest repayment will rise, most borrowers will not face higher monthly installments until 2029.

BOJ Governor Kazuo Ueda emphasized that wage growth is expected to offset mortgage cost increases over time, mitigating household financial burdens. Meanwhile, banks stand to benefit from improved loan profitability as rates rise.

For investors, the shift reflects Japan’s broader monetary policy normalization, though its long-term impact on consumer spending and housing demand remains uncertain.

According to Bloomberg and Business Times, August 2024.