【Topic】Blockbuster good! This year's steel market will continue to take off!
【Author】Lai Yue regeneration Yang Yang
Policy Cases-
On February 8, the Central Bank of China and the China Banking and Insurance Regulatory Commission jointly issued the Notice on The Non-Inclusion of Loans Related to Affordable Rental Housing in the Management of Real Estate Loan Concentration (hereinafter referred to as the Notice). The Notice clarifies that loans related to affordable rental housing projects are not included in the management of real estate loan concentration, and encourages banking financial institutions to increase support for the development of affordable rental housing in accordance with the principles of legal compliance, risk control and commercial sustainability. The Notice also encourages banks to increase their support for the development of affordable rental housing in accordance with the principles of legal compliance, risk controllability and commercial sustainability.
First, what are the reasons for the slow development of affordable housing in the mainland?
Understanding the reasons for the slow development of affordable housing requires first figuring out what affordable housing is.
Affordable housing includes low-cost housing, affordable housing, limited-price commercial housing, and public rental housing. For example, affordable housing is built with government funds, and its advantage is that the price is lower than the market price. The disadvantage is that the liquidity of the listing is poor, and the policy prohibits listing and trading within 5 years. Of course, after 5 years, it is allowed to be listed for trading, but if the transaction is carried out, it is necessary to pay a certain amount of land transfer fee from the government.
We know that in the 15 years from 2007 to 2022, the commercial housing market in the mainland has developed rapidly. Stimulated by its economic benefits, real estate developers have poured into the commercial housing market and taken land for development. Along with the demographic dividend, the supply of commercial housing has exceeded demand, which has not only raised the price of commercial housing, but also compressed the space for affordable housing loans. Affordable housing is a public good, public welfare first, profitability second, its construction and operation need government policy support and financial support. Therefore, the capital investment in the construction of affordable housing is insufficient, the supply cannot be started, and it is difficult to develop on a large scale.
Second, what impact will the release of this policy have on the housing rental market?
Professionals said that the "Notice" sent a positive signal, and the state made great efforts to give strong support to the development of affordable rental housing from the financial policy. The cancellation of the scale limit of guaranteed housing loans can enhance the enthusiasm of banks to lend, and has a positive role in promoting the reduction of the concerns of housing enterprises and the active application for loans to develop affordable rental housing. This will also become an important turning point in the balance between the development of the commercial housing market and the development of rental housing, and will also promote the development of the housing rental market in the direction of scale and specialization.
3. What impact will the release of this policy have on the real estate market?
This policy, from the demand side to open up channels to solve the problem of mass housing, to a certain extent, can alleviate the pressure of "just need" housing families, to solve the housing problems of some difficult groups of housing buyers. It is not only the implementation of the big goal of "housing and not speculation", but also the effective implementation of the people's livelihood problems of low- and middle-income families "living and living", and it is also a good strategy to promote the stable, healthy and orderly development of the real estate market.
Fourth, the impact of the development of affordable housing on the steel market?
Whether it is the development of the commercial housing market or affordable housing, it is a heavy positive for the steel market.
The amount of steel used in real estate supports half of the entire steel market. The trend of the real estate market is affected by policies, and the same influence is reflected in the steel market. China's steel market and the real estate market are inextricably linked, when the real estate development to the peak, the steel industry also ushered in a highlight moment, when the real estate market into a depression, the steel industry also suffered a cold winter.
Since the second half of last year, with the collapse of the Evergrande system, the market has shown deep concerns about the demand for steel. At this point, the state encourages local governments to vigorously develop affordable housing, with the orderly advancement of the policy, this year's affordable housing construction will become an important task of local governments, then the reduction in the demand for steel for commercial housing construction will be supplemented by the demand for steel for affordable housing construction or even surpassed. In addition, the overall tone of steel production capacity this year is bound to continue to be reduced. Then this year is likely to form a situation where steel is in short supply. This is a great benefit for the steel market and the scrap market at the raw material end!
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