The property market can't turn the page
Author: Yu Fei
01 | A new round of bailouts was fruitless again
From the end of August, a new round of rescue of the property market has been fully opened.
On August 31, the central bank and the State Administration of Financial Supervision and Administration jointly issued two documents, one for reducing down payments and one for reducing interest rates on existing mortgages.
The Notice on Adjusting and Optimizing Differentiated Housing Credit Policies issued clearly states:
1. For residential families who borrow money to purchase commercial housing, the minimum down payment ratio for commercial personal housing loans for the first home is not less than 20%, and the minimum down payment ratio for commercial personal housing loans for second homes is unified to not less than 30%.
2. The lower limit of the interest rate policy for the first set of commercial personal housing loans shall be implemented in accordance with the current regulations, and the lower limit of the interest rate policy for the second set of commercial personal housing loans shall be adjusted to not less than the market quotation rate of the corresponding term loan plus 20 basis points.
At present, many central cities have followed suit, reducing the down payment ratio for first and second homes.
On the same day, Guangzhou and Shenzhen canceled the mortgage subscription, and the next day, that is, September 1, Shanghai and Beijing followed suit and officially.
After that, a large number of central cities opened up to bail out. Among them, Shenyang, Fuzhou, Dalian, Nanjing, Zhengzhou, Qingdao, Jinan, Wuhan, Hefei and other cities have completely cancelled purchase restrictions.
Among them, Wuhan has become the only megacity among the 8 megacities, except for Chongqing, which has no purchase restrictions, to completely lift purchase restrictions.
Cartography: Urban Finance
Guangzhou, Xiamen, Xi'an, Chengdu, Suzhou and other cities have greatly relaxed the purchase restriction threshold and narrowed the purchase restriction circle. Among them, Guangzhou is the only first-tier city that has significantly relaxed purchase restrictions.
Now that one month has passed, what effect has the bailout produced? Has it turned things around? The data released by the Bureau of Statistics in the past two days has revealed the answer: not at all, saving a loneliness.
02 | Volume is still bottoming out
Data disclosed by the National Bureau of Statistics on October 18:
In the first nine months, the sales area of commercial housing was 848.06 million square meters, down 7.5% year-on-year, of which residential sales area fell 6.3%. The sales volume of commercial housing was 8.907 billion yuan, down 4.6%, of which residential sales fell 3.2%.
At the end of September, the area for sale of commercial housing was 645.37 million square meters, an increase of 18.3% year-on-year. Among them, the area for sale of residential buildings increased by 19.7%.
Source: National Bureau of Statistics
The decline in the volume and value of commercial housing in the first nine months is still widening, and it is clear that the sales in September are even more dismal than in August.
This shows that the month-long bailout has still not achieved the desired results, and cannot stop the natural adjustment of the real estate market.
Measures such as the abolition of purchase restrictions and the cancellation of mortgage subscriptions have basically no effect.
The volume of transactions in specific cities can also be corroborated.
For example, in Guangzhou, which canceled the mortgage subscription and greatly relaxed the purchase restrictions in September, such a big move only increased the transaction volume of new houses by 11% month-on-month, and the transaction volume of second-hand houses increased by 4.76% month-on-month, which can be described as exhausting.
Similarly, in Wuhan, which fully lifted purchase restrictions on September 19, the transaction volume of new houses did not increase but declined.
Cartography: Urban Finance; Data: Wuhan Housing Bureau
Although there was no relaxation of purchase restrictions, as early as the end of August, Shenzhen, which cancelled the mortgage subscription, the transaction volume of new and second-hand houses in September was still falling, saving a loneliness.
Of course, this number discusses the overall situation, and it cannot be ruled out that there are some real estate projects with reasonable prices, better location and more resistance to falls, good supporting facilities and discounts.
But at present, the overall situation of every city cannot be avoided, even Beijing and Shanghai.
This issue has repeatedly emphasized that the direct cause of the cold market in the real estate market is not some purchase restrictions, sales restrictions and mortgage recognition measures.
Instead, the population has peaked and declined, the urbanization rate has peaked and slowed down, the newborn population is getting smaller and smaller year by year, income and employment uncertainty has increased, the gap between high housing prices and low income has not narrowed, and the pockets and expectations are missing under the combined effect of oversupply and demand.
This round of housing market adjustment is systemic, not a separate market problem, but also industry problems (housing debt chain) and economic problems (income and employment).
Therefore, the current adjustment cycle will not be short.
03 | House prices are still adjusting
The bailout failed to stop the decline in trading volume, nor did it stop the decline in house prices.
On October 19, the National Bureau of Statistics disclosed the rise and fall of new and second-hand prices in 70 large and medium-sized cities in September.
New Housing:
Of the 70 large and medium-sized cities, 54 fell month-on-month, 15 rose and 1 was flat. The number of cities that fell increased by two from August, and the number of cities that rose decreased by two.
This means that the decline in new homes has widened further.
New homes fell year-on-year in 45 cities, up 1 from the previous month. This means that the number of cities where new homes are lower than last year's prices are still increasing.
Second-hand housing:
Among the 70 cities, the price of second-hand housing fell month-on-month, 65 cities, 1 was flat and 4 increased. The number of cities that fell decreased by one from August, and the number of cities that rose increased by one.
Second-hand housing prices fell month-on-month, accounting for 93% of cities.
Among them, the cities where second-hand housing is still rising month-on-month are Beijing, Shanghai, Tianjin and Shijiazhuang.
Second-hand housing fell year-on-year in 67 cities, 3 increased. The number of cities that fell increased by one from the previous month. This means that 96% of cities have fallen house prices below at least 1 year ago.
At least, it's because housing prices in many cities have fallen back to a few years ago, or even a decade ago.
In Shenzhen, for example, house prices have fallen back to 2018.
According to data disclosed by the Leyoujia Research Center, Shenzhen house prices have fallen for two and a half years since they peaked at the beginning of 2021, and the overall average price has returned to the level of 2018.
Shenzhen's decline still shows no signs of stopping.
According to data from Leyoujia, the listing price in Shenzhen was still in a downward trend in September, and the quotations of owners in only 6 areas increased slightly month-on-month, and 90% of the owners' quotations fell or remained stable. The average listing price of the whole city decreased by 0.8% month-on-month.
No matter how exciting the market is, it cannot stir any ripples. The volume of September is already the best explanation.
Mudanjiang, for example, has fallen back to more than a decade ago. Like Hegang, Mudanjiang is also a city with depleted resources and a continuous decline, but Hegang is not included in the statistics of the Bureau of Statistics.
Some time ago, Henan Hebi, which was popular all over the network, 100,000 yuan and 8 suites, although the houses are in the old city, but it has to make people reflect, the city that continues to flow out, the value of the house is being reshuffled.
Some people have counted that some house prices have fallen back to cities seven or eight years ago or even ten years ago. For example, Jilin City, Jilin Province, Weihai Rushan City (county-level city) in Shandong, Dazhou in Sichuan, Yumen in Gansu, and Qiqihar in Heilongjiang.
At present, the decline in house prices in the country continues to expand, combined with the current macro environment, the current national housing supply and demand and future population trends.
The cycle of this house price adjustment will not be short, some predict 5 to 10 years. This also means that there will be more and more cities, and housing prices will continue to fall.
Especially in third- and fourth-tier cities where large industries are weak, inventory is high, population loss, and not only do not get help from central cities but are siphon by them, housing prices will gradually increase.