In 2021, the sales of the top 100 housing enterprises showed negative growth for the first time in 10 years, and financing hit the lowest value in 5 years

The miracle did not happen, and in the last month of 2021, the sales performance of the top 100 housing enterprises was still dismal.

On December 31, sales data released by the third-party agency Kerui showed that the top 100 housing enterprises achieved 1,122.31 billion yuan in a single month in December, a sharp increase of more than 30% from November, but it still fell by nearly 35% year-on-year, and the cumulative sales of the whole year fell by 3% year-on-year. This is the first time since 2010 that the growth rate of sales performance of large-scale housing enterprises has been negative.

In parallel with the growth of scale, the financing performance of housing enterprises has also been accelerated. According to Kerry data, in 2021, the total annual financing of typical-scale housing enterprises fell by 26% year-on-year, showing negative growth for the first time in the past five years and reaching the lowest level in five years. In the fourth quarter, corporate financing once fell to the freezing point, and the total amount of financing decreased by 55% year-on-year.

Although the regulatory authorities have recently issued intensive voices to release positive news about the financing policies of housing enterprises, the industry has formed a consensus that these do not mean that the real estate credit policy has shifted, but are intended to maintain stability and correct deviations. In 2022, the overall financing environment will continue to be based on maintaining the normal financing needs of enterprises and promoting the virtuous circle and healthy development of the industry.

The era of rapid growth with high leverage has officially come to an end in 2021.

The rise of state-owned enterprises and central enterprises

According to Kerry data, in terms of full caliber, in December 2021, TOP100 housing enterprises achieved sales of 1122.31 billion yuan, an increase of 32.4% over November, but still down 34.7% year-on-year.

According to the data provided by Yihan Think Tank, among the TOP30 housing enterprises, only 7 have a year-on-year increase in sales, namely C&D Real Estate, Country Garden, Longhu, China Merchants Shekou, Zhengrong Real Estate, China Resources Land, and China Overseas Real Estate, with year-on-year increases of 72%, 61%, 43%, 37%, 21%, 16%, and 4%, respectively; another 16 housing enterprises have a year-on-year decline of more than 30%.

In terms of specific sales performance, Vanke ranked first in the industry with a sales scale of 56.08 billion yuan in a single month; Sunac achieved 48.06 billion yuan, followed by China Resources Land, China Merchants Shekou and China Overseas Real Estate with a single month sales scale of more than 40 billion yuan; Longhu and Poly achieved 39.69 billion yuan and 36.678 billion yuan respectively, ranking six or seven in single-month sales.

It is worth mentioning that Yuexiu Real Estate increased by 104% year-on-month in a single month, the largest increase in the TOP50, achieving 118.2 billion yuan in the whole year, an increase of 23% year-on-year.

"The state-owned enterprises are very fierce." When it comes to December sales performance, some insiders have described it as follows. Yuexiu Real Estate is also a microcosm of the performance of state-owned enterprises. Most of the TOP10 are state-owned enterprises and central enterprises, and the cumulative sales performance of most of the state-owned enterprises is up year-on-year, and Poly, China Shipping, China Merchants Shekou and China Resources Land are all up around 10% year-on-year.

However, the outstanding growth of state-owned enterprises has not been unable to change the overall downward trend of the industry.

Looking at the industry's sales performance in 2021, the first half of the year was in full swing, and the second half of the year took a sharp turn, and the year-on-year sales decline continued to expand, from a decline of 7% in July to a widening of 39.3% in November.

"We have been rising month by month in previous years, the first half of the year, especially the first quarter, the relative pressure is a little bigger, the market is almost a little, after the second quarter, the market began to stabilize and rebound, and in the second half of the year, it will hit a small new high," Ding Zuyu, CEO of E-House Enterprise Group, said when reviewing sales in 2021, "but the overall situation we see this year is all the way down." ”

Sales that have fallen all the way have created very different data performance in the first and second half of the year. According to Kerry data, in the first six months of 2021, the cumulative trading amount of the top 100 housing enterprises increased by 36.8% year-on-year, while in the five months from July to November, the cumulative trading amount fell sharply by 27.8% year-on-year.

Therefore, in the whole year of 2021, in terms of trading caliber, the top 100 housing enterprises have achieved a cumulative sales amount of 11,080.53 billion yuan, down 3.5% year-on-year; in terms of full caliber, it will fall by 3% year-on-year.

Statistics from the China Finger Institute also show that from the 32 representative enterprises that announced the annual sales target, the overall completion rate of the sales target of housing enterprises in 2021 was significantly lower than that of last year, and the average achievement rate was 90.1%. Among them, the sales target completion rate of Greentown, China Resources, Binjiang, Zhengrong, Yuexiu, Dafabet and other enterprises is more than 100%, and most of the enterprises have not completed the annual target task. The target completion rate for 2020 is 106%.

The leverage reduction will continue

At the same time as the sharp reduction in sales in the second half of the year, there is also the financing situation of housing enterprises. According to Kerry data, from July to November, the total financing of housing enterprises fell by about 40% year-on-year.

The real estate industry has experienced a simultaneous and rapid growth in debt and scale in the past few years. Kerry data shows that from 2015 to 2020, the full-caliber sales of the top 100 housing enterprises increased from 3,495.5 billion yuan to 130462 billion yuan, with a compound growth rate of about 25%; in the same period, the interest-bearing liabilities of housing enterprises rose sharply, such as Evergrande's net interest-bearing liabilities in the five years from 2016 to 2020 increased by 419.6 billion yuan, which was 1.58 times its net increase in 2011-2015; this indicator of Sunac was 7.25 times and Vanke's was 5.58 times.

However, now this logic of using high debt to promote scale growth has come to an end, the financing needs of housing enterprises have been suppressed by the "three red lines", even if the green housing enterprises, the growth rate of interest-bearing liabilities has been controlled at 15%, and the loan concentration management has formed a clamp on the financial institutions that lend.

"At the beginning, everyone still had a fluke, thinking that this round of regulation would not be so tight, and the time would not be so long." Even by the beginning of 2021, the expectations of a number of housing enterprises are still relatively optimistic, talking about being 'stable', and doing small-scale plus leverage," an East China housing enterprise insider recalled, "but from the first round of centralized land supply in the second half of the year, the industry has basically reached a consensus on the goal of reducing leverage." ”

Lin Feng, CEO of Xuhui Holding Group, recently wrote that the policy orientation has not changed, but it is fine-tuned, housing enterprises should give up their illusions, seriously reduce leverage, the industry's high-speed growth period has passed, to change a way to deal with the new environment, "the debt ratio of excellent housing enterprises in the future may not be 70%, but 30%."

Xu Chao, chief analyst of the real estate industry of Pacific Securities, proposed that 2021 is the last year of the rectification time limit of the transition period of the new asset management regulations, and companies should further increase the clean-up of the existing channel business. "Private housing enterprises with a relatively high proportion of non-standards in the financing structure may face the dual pressure of just exchange of bonds and non-standards that are difficult to extend."

Yu Xiaoyu, research director of Yihan Think Tank, also believes that the current credit system crisis facing housing enterprises has not yet been lifted, and the first quarter of 2022 is the peak of overseas foreign debt repayment, and the financial pressure of enterprises should not be underestimated, especially private enterprises. At this stage, the company's top priority is to ensure the safety of cash flow and ensure that it can survive before there will be a future.

As for when it can bottom out, Lin Feng believes that from shouting to forming policies, it is estimated that it will take two to three months, from the introduction of policies to the effect, it is estimated that it will take three months, market recovery also needs time and patience, and financial institutions and market customers are still waiting.