In the past two days, there has been a picture of "Goldman Sachs predicting when China's housing prices will bottom out", which has been spread by everyone.
The forecast is based on the history of home price rises and falls in the United States and Japan:
The United States peaked in 2006 and bottomed out at the end of 2011, and the adjustment time is about 6 years;
Japan peaked in 1991 and stabilized around 2003, with an adjustment time of about 13 years.
Goldman Sachs believes that referring to the trend of housing prices in the United States, after China's housing prices peaked in the third quarter of 2021, they will also experience 24 quarters of adjustment like the United States, and will only stabilize and stop falling in 2027, adding that the current housing prices have just fallen by half.
This prediction is indeed quite scary.
If housing prices have to be cut in half in the next few years, then wouldn't it be necessary to sell the house quickly, if it has fallen for more than ten years like Japan, this pit is even more bottomless, and there is no help?
In fact, no one has given a reliable source for whether this picture is true or false, so this so-called prediction can not be so true.
Besides, how can there be such a direct hard set of data?
Japan, and our size is too different, our government policy is much stronger than Japan, and last time I also said that Japan will engage in overseas investment after the crisis, but our focus will obviously be on domestic construction.
The United States, which is an order of magnitude larger than ours, is also learning from the experience of the United States in transforming into a technology, consumption, and service-oriented society, and the slope of the decline after the peak of housing prices is indeed similar;
But our banks, unlike the US financial crisis, sold real estate, resulting in an avalanche of housing prices, and Chinese also have more special feelings for the house.
As Dr. Gao Shanwen said before, the so-called "bubble" of our real estate is not a typical bubble, and it is different from the bubble in other countries, and the path of future adjustment is different.
Goldman Sachs' prediction of China's housing prices has a reliable source is a report made by the Hong Kong team in June last year, saying that our real estate industry will experience an "L-shaped recovery" and there is no quick solution.
（来源：Goldman Sachs）
The rationale is that the leadership seems to be determined this time around, reluctant to use the property sector as a short-term stimulus tool, and the policy priority is to manage a multi-year slowdown, rather than create an upcycle.
While there will be a lot of easing measures ahead, there is no quick fix to the problem of developer financing in lower-tier cities, so the property sector will experience an "L-shaped recovery" in the next few years.
The term "L-shaped recovery" is quite artistic.
V is recovery, U is recovery, W is also recovery, but the flat L does not seem to be on the edge of recovery, can only say the words of the Hong Kong team, and knows how to please the leader.
However, the analysis of the report is indeed more professional than the single picture transmitted on the Internet.
At the beginning of the year, Sheng Songcheng, former director of the Survey and Statistics Department of the Central Bank, also said at the 2024 annual meeting of the China Chief Economist Forum that it is still in a downward cycle, and it may take 2-3 years to stabilize, and the real estate will be L-shaped in the long run.
He feels that this round of real estate adjustment is trending, not cyclical.
It seems that the bigwigs still have a lot of recognition of the L-shaped trend, that is to say, our expectations can not be too high, don't think about anything after the bottoming adjustment, there will be a rebound immediately, there is no sharp rebound, the housing prices in most areas will go down, there will be no waves, that is, a long time sideways, the core area of the core city, it is estimated that there is room for slow rise.
The goal of the leadership is clear, to be steady, not to lag behind, and then gradually get rid of the dependence on real estate.
So when did you reach the inflection point of L?
Judging from the experience of other countries, whether it is the United States or Japan, after the real estate market deteriorates, it will take a long time to reach the bottom.
Now our real estate companies are in a hurry, and even Vanke's head is still bleeding, plus everyone's confidence has not recovered, they are unwilling to consume, and they are trembling about risky assets, which is obviously too early.
Therefore, it is not realistic to hope that the adjustment will end in the short term.
Of course, if you stretch it out long enough, house prices will still pick up overall.
Like Japan, it fell for 13 years, and then hovered at a low level for 10 years, and began to rise again in 2013, after all, the currency has been over-issued, and scarce good houses, as an important category of assets, are still an important part of the allocation of the rich.
According to the data given by Gao Shanwen, from the situation in the United States and Japan, when the peak of urbanization has passed, the center of real estate investment in GDP is 6.5%-8%, and China's urbanization process has not yet ended.
The proportion of our real estate investment should be about 8% in the long-term center, at least more than 7%, but now this proportion is only more than 6%, and there will still be some space in the future.
From the perspective of the logic of "real estate long-term population", the last wave of population birth highs in recent years was 17.86 million in 2016.
According to the average age of 35 years old, even after 2051, this long-term logic will no longer be able to support the property market.
Therefore, for the real estate sector, don't fantasize about the rapid growth of the bounce after the adjustment as before, because the overall trend has gone, but there is no need to be pessimistic to feel that the industry is going to collapse, be objective, and follow the trend.
On the one hand, it is necessary to gradually reduce the excessive proportion of real estate in total assets, at least not more than 50%.
If you want to keep the core scarce good house with investment value, you must also do a good job in expectation management, according to the situation of houses in first-tier cities in developed countries, it is already quite good to be able to achieve a long-term rate of return of 5%.
Some people say that it is too difficult to sell a house now, yes, they are all fighting for the price, we also said before, now it is a buyer's market, you don't cut yourself first, and be prepared to continue to be cut, you can't sell at all.
However, now there are a bunch of third- and fourth-tier cities, and the government has successively introduced policies to directly purchase second-hand houses