The property tax has not come, "it" has come first, up to 20%, will there be a "sell-off" in second-hand housing?
According to the latest data released by the National Bureau of Statistics, from January to February 2024, the national property market sales data was very poor, with the sales area and sales of commercial housing falling by 24.8% and 29.3% respectively, compared with 2023, this decline can be called a cliff-like decline. Obviously, the property market rescue policy in 2024 has not achieved the expected effect, but the property market continues to cool down, and the cold is pressing.
What's more remarkable is that according to the data of these two months, the average price of newly built commercial housing has dropped to 9,293 yuan / square meter. This means that the average price of newly built commercial housing in January and February has not only fallen sharply, but has fallen back to the level of 2019. It can be seen that house prices have experienced a significant decline at the beginning of 2024.
Curiously, however, while the data clearly shows a drop in house prices, many people don't seem to be really feeling the change. What is the reason for this? In fact, the housing prices are too high. Even if calculated according to the average selling price of 9,293 yuan/square meter of newly built commercial housing from January to February, the starting point for purchasing a property is at least 900,000 yuan. This high housing price has undoubtedly discouraged many buyers who just need to buy a house, and they feel more and more pressure to buy a house.
However, in stark contrast, there is a current surplus of housing resources, with the majority of urban households already owning homes. Authoritative data shows that nationwide, more than 96.86% of urban households own at least one house, and the average number of houses per household even exceeds 1.5. Among them, more than 31% of households own two or more properties, and more than 10.5% of households own three or more properties. These data clearly show that the current continuous rise in housing prices is not due to a shortage of housing resources, but a large number of properties are hoarded, thus creating the illusion of scarcity of housing resources.
In addition to individual investors, there are also so-called "real estate speculation groups" and a large number of enterprises have also joined the ranks of real estate investment. Take the former "Wenzhou real estate speculation group" as an example, every time they go, the housing prices in the local cities will soar. In addition, the phenomenon of corporate property speculation cannot be ignored. According to the financial report data of A-share listed companies in 2019, more than half of the 3,743 listed companies hold a large number of investment real estate, of which 1,826 listed companies hold a real estate market value of 1,334 billion yuan. In addition, in addition to these A-share listed companies, there are also a large number of unlisted companies and overseas listed companies in mainland China that are also actively involved in real estate investment. Therefore, it can be said that there is no shortage of housing resources in the mainland at present, but that these properties are hoarded by speculators and enterprises, resulting in an imbalance between supply and demand in the market.
How to solve the problem of hoarding and speculating on real estate? The property tax and vacancy tax are highly anticipated
Although house prices have shown a downward trend in the past two years, the impact on individuals and businesses who already own a large number of properties is limited. They choose to continue to hoard property in the hope that house prices will rebound, and those who do sell their properties are often in dire need of money. Therefore, many people are pinning their hopes on the introduction of the property tax, hoping to increase the high tax revenue of investors through this policy. It is only when the cost of owning a property increases that investors may be forced to sell their property, so property tax is seen as a nemesis for speculators.
In fact, many countries have implemented property taxes, which are effective in cracking down on speculators. In addition to property taxes, vacancy taxes are also seen as an effective means of cracking down on property speculators. Many speculators hoard properties that are often left vacant, as rough and unoccupied homes are often sold as new homes at a higher price. Although the news of property tax has been reported from time to time, the vacancy tax has not been moved.
In recent years, there has been an increasing number of discussions and forecasts regarding the implementation of property taxes. Ma Guangyuan, a well-known economist, predicts that a property tax could be introduced between 2025 and 2030. In addition, the "China Housing Report 2021" of the Institute of Financial Strategy of the Chinese Academy of Social Sciences also clearly pointed out that the property tax is likely to be officially implemented in the next 10 years. It is worth noting that the real estate data collected by the seventh national population census and the preliminary completion of the national real estate network have provided the necessary basis for the implementation of the real estate tax, cleared the relevant obstacles, and created favorable conditions for the introduction of the real estate tax.
Although the property tax has not yet landed, the landlord tax has already arrived
Most experts and scholars expect the property tax to be implemented in the next five to ten years, but it is difficult to predict when it will be introduced. In the meantime, the landlord tax has been quietly implemented. According to the announcement issued by the Yunnan Provincial Taxation Bureau of the State Administration of Taxation, when an individual rents out his or rents a house in Yunnan Province and obtains rent or other economic benefits, he or she is required to pay individual income tax according to the "income from property lease".
In other words, landlords in Yunnan Province will be required to pay landlord tax. As for the tax standard, the announcement also clearly stipulates that if the landlord can provide the rental cost rent, 20% of the remaining rent will be taxed after deducting the rental cost, and if the rental cost cannot be provided, a 10% tax will be levied on the entire rent. This regulation shows that the maximum landlord tax rate in Yunnan Province is 20%, which is still a high tax rate.
In addition to Yunnan Province, Hebei and Hunan imposed landlord taxes as early as 2019. Compared to the complicated process and preparation of a property tax, the introduction of a landlord tax seems to be faster and easier. With the implementation of these three provinces, it is possible that the landlord tax will soon be rolled out nationwide. This is undoubtedly a challenge for people who own multiple properties or live on rent, or even "rent and finance".
So, will the second-hand housing market usher in a "sell-off wave" in the future?
Judging from the current market situation, the second-hand housing market has shown a serious selling trend. This is not entirely due to landlord taxes, but more to the backdrop of falling house prices, speculators are starting to reassess the value of property investments and are pessimistic about future house price trends. As a result, many property speculators have begun to choose to sell their properties, even lowering the listing price to facilitate the transaction.
The introduction of landlord taxes is likely to further exacerbate this trend, causing more investors to sell their properties to avoid taxes. With the withdrawal of speculators, the supply of housing in the second-hand housing market will increase significantly, exceeding market demand. This will not only lead to a continuous decline in second-hand home prices, but may also have an impact on the new home market.
To sum up, the future second-hand housing market is indeed likely to usher in a wave of "sell-offs", which will have a profound impact on housing prices and the entire real estate market.