Core Viewpoint - The National Taxation Administration of China has clarified that individuals who convert their second home loans to first home loans can continue to enjoy tax deductions on housing loan interest, following the new policy of "recognizing homes, not loans" [1][4]. Group 1: Policy Changes - The new policy allows individuals to change their second home loan status to first home loan status, enabling them to benefit from lower interest rates and tax deductions on loan interest [1][5]. - Taxpayers can continue to enjoy the housing loan interest special deduction if they replace their existing loans under the new guidelines, as long as the property remains the same [3][4]. Group 2: Tax Deduction Details - The housing loan interest special deduction allows for a monthly deduction of 1,000 yuan, with a maximum deduction period of 240 months, totaling up to 240,000 yuan over 20 years [4]. - Individuals who have not previously enjoyed the housing loan interest special deduction can start benefiting from it from the month they begin repayments at the first home loan interest rate [4]. Group 3: Market Implications - The policy is expected to lower the basic living costs for residents and support continued home ownership, which may prevent disorderly selling and early loan repayments [4]. - The reduction in housing holding costs is anticipated to positively impact housing demand in the second quarter and beyond [5].