In the first quarter of this year, residents' willingness to buy houses has been hovering at a low level, resulting in a relatively slow release of housing demand. According to agency data, in March this year, the main respondents of the current demand for housing believed that the expected decline in housing prices accounted for 31%, showing an increasing trend again, and the resistance to buying houses was mainly due to high pressure on loan repayment, unstable income, and falling housing prices.
Industry insiders said that at a time when confidence in the real estate market is low and sales are still weak, repair expectations are the key. With the intensive release of property market policies, or drive the gradual recovery of market sentiment, it is expected that the overall downward trend of new and second-hand housing prices in April will not change, but the month-on-month decline may show a trend of narrowing or stabilizing.
The release of demand is slow, and the proportion of planned home purchases within half a year is still at a low level
Photo/Middle Finger Research Institute
In March this year, the property market showed a weak recovery, mainly due to the low level of residents' willingness to buy houses. Its specific performance is in the increase in the scale of real estate enterprises, the improvement of marketing efforts, and the obvious price reduction of some projects, although the number of visits has increased slightly, but the transaction is still at a low level.
According to the "Survey Report on Residents' Willingness to Buy Houses" (hereinafter referred to as the "Report") released by the China Index Research Institute on April 16, in March this year, about 17% of respondents chose "stronger willingness to buy a house than last month", a decrease of 2.2 percentage points from the previous month, and about 18.2% planned to buy a house within half a year, a slight increase from February. Although the activity of the property market has been slightly restored, residents' housing purchase plans have increased slightly, but the overall level is still at a low level, and the release of housing demand is relatively slow.
It is reported that the vast majority of the above-mentioned respondents are young people working in second-tier cities and third- and fourth-tier cities, and they are also the main force of the current demand for housing and replacement. From the perspective of the current resistance to buying houses, the pressure of loan repayment, unstable income, and falling housing prices are the main factors affecting residents' house purchases, accounting for more than 35%. Among them, the proportion of factors with unstable income and high pressure on loan repayment increased steadily, 41% and 42% respectively, up 1.4 and 1.2 percentage points respectively from the previous month, and the resistance to buying a house is still at a high level.
It is worth noting that due to the weak recovery of the property market and the increase in price reductions by real estate companies, residents' expectations of bearish housing prices are also increasing. According to the report, 31% of respondents believe that the expectation of house price decline accounts for 31%, an increase of 1 percentage point from the previous month, showing a trend of increasing again, while the expectation of increase continues to be at a relatively low level, accounting for about 13% of the increase expectation.
Another set of survey data also shows that the current willingness to buy a house is not strong. According to the "2023 Fourth Quarter Urban Depositor Questionnaire Survey Report" released by the People's Bank of China on March 22, the proportion of residents expecting a "decline" in housing prices has increased. Among them, 12.3% of residents expect housing prices to "rise", 53.9% expect "basically unchanged", 20.2% expect "decline", and 13.6% are "uncertain". When asked about the items they plan to spend more on in the next three months, only 14.3% of residents chose to buy a house, down 3 percentage points from the previous quarter.
CRIC found through data comparison that this is the first time in the past five years that the proportion of residents who have "declined" in housing price expectations has exceeded 20%, which means that residents' expectations for housing prices have fallen to the lowest point in nearly five years. Historically, when the market is performing well, residents are more optimistic about housing prices, when the market is performing poorly, residents are pessimistic about housing prices, and when the market recovers, residents' expectations for housing prices will also be restored.
Photo/Middle Finger Research Institute
Industry: Intensive policy releases may drive market sentiment to gradually recover
Although the willingness to buy a house is not strong, what needs to be seen is that in the first quarter of this year, all localities will accelerate the optimization of real estate policies. Among them, the frequency of policy relaxation increased in March, and the central and regulatory departments continued to release positive signals to stabilize the market, making it clear that they would "further optimize the real estate policy"; Beijing canceled the "divorce purchase restriction", Hangzhou relaxed the purchase restriction on second-hand housing, Tianjin reduced the proportion of provident fund down payment, Guangzhou and Shanghai introduced housing purchase subsidies, and Hangzhou and Wuhan strengthened the "old for new" policy support.
Due to the effect of the policy in some core cities, there was a moderate recovery market in March, which showed that the year-on-year decline in the sales area and sales of newly built commercial housing in the country from January to March this year was narrower than that in January and February, but under the high base of the same period last year, the year-on-year decline in the sales scale of new houses was still larger.
On April 16, according to the data of the National Bureau of Statistics, from January to March this year, the sales area of newly built commercial housing in the country was about 227 million square meters, a year-on-year decrease of 19.4%, and the sales of new commercial housing in the country were about 2.14 trillion yuan, a year-on-year decrease of 27.6%. At the same time as the transaction volume is falling, the trend of exchanging volume from decline is more obvious, and house prices are still hovering at the bottom.
Ding Zuyu, CEO and executive director of E-House Enterprise Group, believes that on the whole, it is expected that market supply and demand will not warm significantly in the short term, and corporate sales will continue to face great pressure. To this end, at a time when confidence in the real estate market is low and sales are still weak, recovery expectations are key. There is still room for further easing of policies in the future, especially the purchase restrictions in the core areas of first-tier cities and the full unbundling of restrictive policies in some second-tier cities, which may help stabilize the market to a certain extent.
"The continuous loosening of the policy side still has a certain positive impact on promoting the release of demand, but this year's real estate market is different from last year, the heat will slowly pick up, the time cycle will be extended, and the pace of price repair will be slow. Guan Rongxue, a senior analyst at Zhuge Data Research Center, said that as the policy support for the demand for improved housing continues to increase, the intensive release of property market policies may drive the gradual recovery of market sentiment, and it is expected that the overall downward trend of new and second-hand housing prices in April will not change, and the month-on-month decline may show a narrowing or stabilizing trend.
Regarding the trend of the real estate market, on April 16, Sheng Laiyun, deputy director of the National Bureau of Statistics, said at the press conference of the State Council Information Office that it is necessary to look at this round of real estate adjustment rationally. The phased adjustment of real estate is conducive to the subsequent construction of a new model of real estate and the realization of high-quality development. He believes that the mainland real estate market still has the supporting conditions for sustained and healthy development. At present, the effect of policy measures continues to appear, and various localities have increased their efforts to support the stable development of real estate, including relaxing purchase restrictions and reducing provident fund loan interest rates. Since the beginning of this year, more than 30 cities have proposed a policy of exchanging old houses for new ones. With the joint efforts of local governments, the decline in the area and value of real estate sales in March this year narrowed respectively.
Beijing News reporter Yuan Xiuli
Edited by Wu Xin and proofread by Liu Baoqing