Cancel the purchase restriction order and liberate the whole of China

WeChat Public: Ke Perspective (ID: lincokl)

Editor-in-chief: Ke Tan (Personal WeChat: linco_kkkkk)

Believe me, the current senior management departments are actually more entangled and uncomfortable than us ordinary people. There are a lot of tools in the toolbox, and you don't dare to use them if you want to. House prices have risen, afraid of responsibility, house prices have fallen, afraid of incompetence.

What is the root cause? That is, you only need to be responsible to the top, not to the bottom.

The current property market is a typical pulse market. Out of policy, for a while, no policy, soft stomach, like a very middle-aged man, has long been not a teenager who can be excited all day by lust.

During the past Golden Week, the performance of the property market was extremely divergent.

In first-tier cities, Guangzhou and Shanghai are highly popular; Among the second-tier cities, Wuhan and Suzhou are hot, and other cities are a mess. The reason for Shanghai's heat is that there are many new houses pushing market; The reason for Guangzhou's heat is that the policy has been relaxed the most, and Huangpu, Panyu and suburbs have lifted purchase restrictions; The reason for the great heat in Wuhan is that it is completely stripped and there is no purchase restriction at all; The reason for Suzhou's heat is that the city's fundamentals are good and the policy is loose. The reason for the cold in Beijing is that it caught fire for 2 weeks after recognizing the house and not recognizing the loan on September 1, and then there was no policy to continue to top, so it stopped cooking; The reason why Shenzhen is cold is that he has been scared by the policy in the past two years, just like a native dog who has been taught a dog by a beating stick, and he dare not eat meat when fed him. Needless to say, other cities have not risen in the first and second tiers, and they are even less likely to improve.

The property market is no longer what it used to be, starting from the down jacket one by one, the final result must be that the first line and the second line are all completely canceled purchase restrictions, and the north Shanghai Guangshen has money to buy casually. Just like my last article "North to Guangzhou Shenzhen, will completely cancel the purchase limit" said.

Yesterday, I saw the article that Meng Xiaosu, former leader of the National Housing Reform Research Group, former chairman of Zhongfang Group and chairman of Huili Fund, participated in the "Phoenix Bay Area Financial Forum 2023" on September 27 to be interviewed. Meng Xiaosu's thinking is in line with mine. It makes sense for everyone to study it carefully:

Phoenix.com Finance "Phoenix Family Lounge": At the end of last year, you proposed that first-tier cities should take the lead in canceling purchase restrictions, and the current policy is that second- and third-tier cities have begun to relax purchase restrictions, and only the peripheral areas of Guangzhou in first-tier cities have relaxed purchase restrictions. How do local governments consider "loosening" the property market?

Meng Xiaosu: In 2016, we proposed to the central government to de-inventory, the central government adopted, and then started from the first-tier cities, and gradually promoted the start of the property market to the whole country, Shenzhen, Shanghai, Beijing, and quickly radiated to strong second-tier cities and third-tier cities, driving the country's economy. This downturn in the housing market is very similar to the one in 2014 and 2015, and it is also necessary to de-inventory once. So at the end of last year, I held a meeting with Liu Shijin, Jia Kang and some other experts to urge Beijing, Shanghai, Guangzhou and Shenzhen to take the lead in canceling purchase restrictions, hoping to repeat the experience of launching the market in 2016.

I heard that the effect is still there, you see the media reports, saying that the main leaders of the four first-tier cities also want to cancel the purchase restrictions, and other second- and third-tier cities still cancel the purchase restrictions. Although the person in charge of the Ministry of Construction, they did not directly mention the cancellation of the purchase limit, but put forward a small goal of "recognizing a house without recognising a loan", and some experts ridiculed that what kind of goal is this? But this is a limit of what they can do, and in this way, they euphemistically express their opinions on purchase restrictions and loan restrictions, and I think it's good that they can make such a statement when they are bound by themselves. Cities are obedient, so they are taking action.

The four cities of Beijing, Shanghai, Guangzhou and Shenzhen still have an "invisible" rope in bondage. Their own land concessions are also decreasing, economic development is in difficulty, and they also need to remove purchase restrictions to protect the economy. But in the current situation, I see that it may be a while before they are recognizable.

All these problems are blocked at one point, that is, it restricts the real estate market, and some people think that it is choking its arm, but it is not, it is choking its neck, so this determines the whole body. So why insist on purchase restrictions? Since the people are not willing to buy houses, then I have to ask rhetorically, why do you restrict the people to buy those things that they do not want to buy? Isn't this a drain on administrative resources, a waste of administrative resources?

Some people say that if the purchase restriction is lifted, will the market still not rise? I said yes, but you cancel the purchase limit first. There is no reason to speculate on the market without canceling the purchase limit, because how can you analyze market supply and demand in the state of purchase restrictions? So many years of purchase restrictions have made people's minds also go into the wrong area, thinking that it is not okay without restrictions. Just like when we used food stamps for many years, many old people were surprised when they canceled food stamps, can they buy food directly with money in the future? There are no restrictions on the purchase of houses all over the world, and people from those (unlimited) countries have gone to the capital, and there are no people in other cities? This is not the case, there are various market factors to constrain, so we should not now let personal thinking into the wrong zone.

I think the removal of purchase restrictions is the first step in revitalizing the market at present, and it is conceivable that some other measures will not work until the purchase restrictions are lifted. In addition to the actual effect, the cancellation of purchase restrictions also has a psychological effect, because now there is a lack of confidence, and now the people always think that the real estate policy may change back at any time. Then if first-tier cities such as Beijing, Shanghai, Guangzhou and Shenzhen and all second-tier cities cancel purchase restrictions, it is "canceling the purchase restriction order and liberating the whole of China", so that people will build confidence. In fact, it is not because of a lack of confidence that causes purchase restrictions, but because purchase restrictions increase people's lack of confidence. Now we need to see these problems clearly and solve them step by step.

Like "Bian Que sees Cai Huan Gong", I have advocated the abolition of purchase restrictions for many years, and although this "disease" is deepening, it is good that I am not terminally ill. China's economy has huge endogenous potential, I and some experts have different views, I think our Chinese economy can recover, Chinese residents themselves have huge demand, not only including the commercial housing market, but also the huge demand for affordable housing, once these two markets are enlivened, China's economy will once again return to strong and healthy development like the previous rounds.

Phoenix Net Finance "Phoenix Family Meeting Room": "Canceling purchase restrictions is the trend of the times", so will house prices suddenly rise to the point where we can't accept it in the future? Will there be any changes in the trend of house prices?

Meng Xiaosu: Recently, the media reports on housing prices have different statements, for example, from the statistics of the National Bureau of Statistics analysis, this year's house prices have come out of last year's decline (last year fell by 3.3%), this year overall the price of new houses is rising, and various cities reflect that the price of second-hand houses is either rising, some falling. But overall, compared with foreign real estate, the real house price fluctuates, in contrast, our decline is also slight, the rise is also stable, which makes people rest assured. Because house prices have fallen by only 3% in total last year, it has caused such a big panic. Therefore, the people are unwilling to consume when they hold their money bags, what is the reason? This is because the house is not a daily consumer good, it is a capital product, this asset is like buying stocks, who wants to buy down, who wants to see the house price fall and buy?

When I was in Hong Kong, I asked some entrepreneurs, and they said that they hadn't bought a house for 6 years, and their children had grown up. I said you just need it, why don't you buy a house, he said that the house price is not falling? It can be seen that in the market where house prices are falling, rich people just need to hesitate to buy a house. Last year, we saw that the rich people were saving a lot of money, how much did they save? At the end of the year, it will be 17.6 trillion. It was in that context that I proposed that these wealthy residents take out 1/3 of their savings to buy a house. They deposited the money they had originally prepared to buy a house in the property market to the bank, and now they have to return it and buy a house again, and the economy can recover. Some people spread rumors that I let low-income groups buy commercial housing to "rescue the market", I never said that let low-income groups buy commercial housing, I advocate the construction of affordable housing for low-income groups.

Last year, the sales of the entire property market lost 5 trillion yuan, and this year it continued to decline, last year it has gone from the first floor to the floor, to the basement, and this year from the basement to dig a pit, lost more than in previous years. If you think about it, if a child gives him one less bowl of rice for one meal, and still eats one less bowl of rice for the second meal, the child will be hungry and thin.

So the question you asked just now about housing prices, and the problem of the shrinking of the whole amount of work that I am worried about, these are the real problems that exist in the economy at present. We don't need to worry too much about whether house prices will rise or fall now, I think the most important thing is that you first remove the restrictions imposed on commercial housing, and then let the normal concept slowly return. Now in September slightly put forward a "house recognition but not loan" (policy), the market began to recover, now gold nine silver ten has not passed, if October can further in the recognition of housing and do not recognize loans to go forward, the comprehensive cancellation of purchase restrictions, to give the people a stronger confidence, believe that the market will change.

Phoenix Finance "Phoenix Family Living Room": In fact, I want to raise this question from the perspective of home buyers, what advice do you have for the group of house buyers? Is now a good time to buy a home?

Meng Xiaosu: For buyers, there should be differential treatment. I have always believed that commercial housing and affordable housing should be "dual-track parallel", if it is a buyer of commercial housing, whether it is just needed or improved demand, now is the right time to buy a house, it is rare for such a long period of low housing prices, coupled with a large aspect, the country's economy also needs to be driven by revitalizing the property market. After a while the market stabilizes, house prices will rebound, and this good opportunity may pass.

But for many low-income people, I don't think they should take money to buy commercial housing at this time, because they should be allowed to enjoy affordable housing. Now the state has been vigorously promoting the construction of affordable housing, the Political Bureau and the State Council have made arrangements, and the Ministry of Construction is also putting forward requirements for various places, I believe that there will be more affordable housing output after a period of time. In this case, low-income groups can buy or rent affordable housing in the future - even if they rent, there is also the state advocated by both rental and sale, rent for a few years, and it is likely to be bought at a preferential price. Therefore, I think that you residents of affordable housing need to be patient, wait, and we will jointly promote the construction of national affordable housing to make a big progress.