The pace of recovery of housing demand is slow, the property market is still bottoming out, and reducing the cost of housing is still the focus of city-specific policies.
On April 15, the Zhengzhou Housing Provident Fund Management Center solicited opinions from the public on the matter of "business to business", and provided two ways to convert "business to business" in the document. Since last year, dozens of cities have introduced support policies for "business to business", but the specific landing conditions are different.
As a highly vocal initiative in the field of provident fund policy, "business to business" is also regarded as an important way to further narrow the gap between the interest rate of existing housing loans and new housing loans. Taking Zhengzhou as an example, according to the calculation of a loan of 1 million yuan and equal principal and interest for 30 years, the monthly payment of the first home buyer can be reduced by 475.21 yuan after the "business to business", and the interest can be saved by more than 5,700 yuan a year.
Many analysts believe that the cities that implement the "business to business" policy will continue to expand. However, considering the restrictions on the scale of deposit and the utilization rate of funds, the room for benefit may be relatively limited, so some cities have set some restrictions on this business.
The new policy of "business to business" continues
In many places, the "business-to-business" policy is not a new one, but some cities have suspended the business due to shortages of funds in the early stage.
Due to the huge difference between the interest rate of housing provident fund loans and commercial loans, "business to business" has always been a high-profile business, and in the past two years, with the opening or reopening of some cities, the concern of citizens around the country has been further enhanced.
Taking Zhengzhou as an example, the Zhengzhou Housing Provident Fund Management Center used to carry out the "business-to-business" loan business before 2015, but later suspended the business due to the tightening of funds. The Zhengzhou Housing Provident Fund Management Center previously said that the main reason for the suspension at that time was that with the popularization of the provident fund system, the demand for provident fund loans has grown rapidly, and the capital utilization rate of the Zhengzhou provident fund is relatively high.
As early as November 2020, August 2023 and other points in time, the Zhengzhou Housing Provident Fund Management Center replied to the public's questions about the "business to business" business, saying that in accordance with the policy positioning of giving priority to the protection of the first house just needed housing, combined with the operation of the city's provident fund funds, it was still only possible to meet the needs of new home buyers to directly apply for provident fund loans, and the continued opening of the "business to business" loan business will affect the new home buyers to handle the provident fund loan business.
This time, Zhengzhou reopened the "business to business" business, and provided two conversion methods: self-raised funds and direct repayment of provident fund (also known as repayment before loan and loan offset by loan in the industry), which will further reduce the burden on eligible home buyers in the city.
Liang Botao, general manager of the Henan branch of the China Index Research Institute, believes that in the past, Zhengzhou only supported the "business to business" with provincial, railway, and coal provident funds, but the coverage group was narrow, and the process also required to pay off the commercial loan before applying for a provident fund loan. The issuance of the solicitation of opinions means that the "business to business" of the municipal provident fund is about to be implemented, and two different conversion methods are provided at the same time, which increases the operability of the business to the public.
After the policy adjustment in 2023, the maximum loan limit of Zhengzhou's housing provident fund will be increased from 800,000 yuan to 1 million yuan (1.2 times the upper limit of eligible loans for families with many children). According to the loan of 1 million yuan, 30 years of equal principal and interest, the current local first home provident fund loan interest rate is 3.1%, compared with the LPR level of 3.95% after the unified adjustment of the stock of the first home loan interest rate in September last year, the monthly payment of buyers after the "business to business" will be reduced from 4745.37 yuan to 4270.16 yuan, 475.21 yuan less per month, and more than 5700 yuan of interest can be saved in a year.
In addition to Zhengzhou, according to the monitoring data of the China Index Research Institute, since 2023, nearly 30 cities have supported "business-to-business" loans, and the policies mainly include the resumption of business-to-business loan business, support for "business-to-business" portfolio loan business, reduce relevant threshold requirements, support "subordinate mortgage" provident fund direct repayment, and expand the scope of "subordinate mortgage" cooperative banks.
The reporter searched and found that among the cities that currently support the "business to business" business, there are not only second-tier cities, but also third- and fourth-tier cities, including Shenyang, Taiyuan, Harbin, Shijiazhuang, Taizhou, Anshan, Longyan, Dongguan, Putian, Zhuzhou, Hohhot, Rizhao, Chuxiongzhou, Yinchuan and other cities.
What are the conditions
"While improving the efficiency of the use of provident fund, the 'business to public' is also conducive to reducing the interest expense of the family loan that has purchased a house, reducing the cost of buying a house, thereby repairing market expectations, and also helping to release the consumption potential of residents to a certain extent. Chen Wenjing, director of market research at the China Index Research Institute, told reporters that in the short term, provident fund-related policies are still one of the important measures to promote rigid and improved housing demand into the market and support the release of housing demand.
However, judging from the current "business to business" policy in various places, many places have set certain threshold conditions, which are related to the restriction of the use of funds. For example, the "business-to-business" loan business in Hunan Province only supports the application of employee families with the only self-occupied house, and implements dynamic management of the business-to-business loan business, and appropriately restricts the flow when the personal loan rate is between 85% (inclusive) and 90%, and when the personal loan rate is higher than 90%, the business appointment and acceptance will be suspended.
However, some cities are also optimizing the landing conditions. Taking Shenyang as an example, the city's Housing Provident Fund Management Center has recently adjusted the original requirement of "business to business" that commercial loans have been "repaid for 5 years or more" to "have been repaid for 3 years or more", so as to expand the beneficiary group of the "business to business" loan policy.
According to the Regulations on the Administration of Housing Provident Fund, the remaining funds of the housing provident fund are used to issue housing provident fund loans after the employees are guaranteed to be withdrawn in accordance with the regulations, and the employees who have paid into the housing provident fund can apply for provident fund loans from the housing provident fund management center when they purchase, build, and overhaul their own houses.
In 2021, the Zhengzhou Housing Provident Fund Management Center mentioned in its reply to a proposal on the issue of "business to business" that the "business to business" business is a business advocated by the national housing provident fund regulatory department for cities with conditions. As a special form of provident fund loan, the first premise for carrying out this business is that the utilization rate of personal loans of the local housing provident fund (the proportion of the balance of the provident fund loan to the aggregated balance) is not high, and the surplus funds (the aggregated balance minus the loan balance) are large.
Chen Wenjing also pointed out that there is a large gap between the balance of provident fund contributions and the balance of personal housing loans, and the scale of "business to business" is limited, so it is necessary to set conditions and thresholds for it. In this context, on the one hand, the industry calls for and expects the further expansion of "business-to-business" cities, and on the other hand, it is also conservative about the scope of benefits.
According to the data, as of the end of 2022, the balance of the national housing provident fund was 9.2 trillion yuan, the balance of loans was 7.3 trillion yuan, and the personal housing loan rate was 78.94%, and the balance of personal housing loans exceeded 38 trillion yuan in the same period.
From Zhengzhou's point of view, the background of the city's suspension of the "business to business" business in 2015 is that the utilization rate of personal loans once reached 95.7% (90% is the warning line), and it has remained high for a long time, and the balance of funds is seriously insufficient. According to the latest data, by the end of 2023, the sum of the balance of personal housing loans, project loans and the balance of purchased treasury bonds of the Zhengzhou Housing Provident Fund accounted for 79.83% of the balance of deposits.
According to the reporter's incomplete statistics, although the medium and long-term loans of commercial banks are still sluggish, the withdrawal and use of housing provident fund loans in some cities have increased last year, and the contribution rate of housing has increased significantly.
Taking Changsha as an example, in 2023, the city's provident fund withdrawal will increase by 34.7% year-on-year, the amount of personal housing loans issued will increase by 63.45% year-on-year, the balance of personal loans at the end of the year will be 107.29 billion yuan, an increase of 18.25% over the end of the previous year, the total amount of deposits in the same period will increase by 15.82% over the end of the previous year, and the balance of contributions will increase by 10.10% year-on-year. The ratio of the sum of the amount of personal housing loans, subsidized loans for public to commercial enterprises, project loans, and housing consumption withdrawals was 122.88%, an increase of 31.72 percentage points over the previous year.
Last year, the amount of provident fund withdrawals in Zhengzhou increased by nearly 50% year-on-year, the amount of personal loans increased by about 35% that year, the balance of deposits during the year (123.408 billion yuan) increased by 5.45% year-on-year, and the housing contribution rate was 95.85%, an increase of 24.23 percentage points over the same period last year. In 2023, Shenyang's personal housing provident fund loans will also increase by 56.21% year-on-year, and the housing contribution rate will be 103.19%, an increase of 17.87 percentage points over the previous year.
(Source: National Housing Provident Fund 2022 Annual Report)
(This article is from Yicai)