China's real estate market has always attracted much attention, and recently, a series of remarks by Peking University professor Yao Yang have once again sparked heated discussions from all walks of life.
Professor Yao Yang believes that the adjustment of housing prices is not fast enough, causing people to dare not buy houses, and said that this is not because people have no money to buy houses, but because housing prices have not fallen in place.
(All the content of the text statement has reliable information sources, and it is repeated at the end of the article. ）
First, the speed of housing price adjustment is not fast enough
Professor Yao Yang's view that the need to accelerate the decline in housing prices to stimulate enthusiasm for home buying is a profound reflection of the current state of the real estate market.
Today, the real estate market in which we live is facing many challenges and problems.
Housing prices remain high, while transactions are relatively sluggish, which has become the focus of social attention.
Behind this phenomenon, there is not only the advancement of urbanization, but also the interaction of factors such as policy regulation and market demand.
As urbanization continues to advance, rising house prices seem to have become the norm.
Urban development has led to population agglomeration, while limited land resources and insufficient supply have led to an increase in housing prices.
However, this excessively rapid increase is not sustainable, and it not only creates a bubble build-up in the real estate market, but also exacerbates social inequality.
On the one hand, the soaring housing prices have brought great pressure on the cost of housing for ordinary residents.
For many families, owning their own home is a basic desire and need.
However, as housing prices soar like a rocket, many people are beginning to wonder if they have crossed over the globe. Even if you work hard and save a lot of money, you can only watch the price of the real estate market float in the sky. This has left many families living in the rental market for a long time, or they have become homeless, and the blow to the quality of life can be described as miserable.
Soaring housing prices have also brought with it socio-economic instability.
In some big cities, the surge in house prices has exceeded many expectations, leading to a boom in the real estate market as a whole.
However, this boom is often unstable because it is based on high debt and high risk.
Once the real estate market adjusts or the bubble bursts, it will have a huge impact on the entire economic system, which may lead to an economic crisis or even social unrest.
There are many reasons for the skyrocketing house prices.
Supply and demand are one of the main factors affecting house prices.
With the acceleration of urbanization, the population continues to concentrate in cities, while the supply of the real estate market is relatively lagging behind, resulting in rising housing prices.
The factor of investment speculation has also exacerbated the volatility of house prices.
Some investors see real estate as an ideal investment, and they buy a property not for their own residence, but for short-term profit.
This speculation has made house prices more volatile and exacerbated the upward trend in house prices.
Housing prices are like a balloon, rising rapidly, and there is no place to buy a house.
In order to control this excessive price increase, the government has come up with a bunch of policies, such as raising down payments, limiting purchases, and so on.
But the problem is that these policies seem to have only a superficial effect, and the real solution to the fundamental problem of high housing prices has not been solved.
Professor Yao Yang said that the prosperity of the real estate market is actually blocking the way for our economy to adjust.
You see, people are crazy about investing in real estate, which not only leads to the deviation of the economic structure, but also adds to the instability of our economy.
In the past, the manufacturing and service industries were attracted to real estate.
This is not a good phenomenon, once there is a problem in the real estate market, the whole economy will be hit hard!
It's like a person who always depends on a certain kind of food to sustain his life, so if that food supply is cut off, isn't he going to starve? Well, that's what it means.
Our economy is overly dependent on the real estate industry, and when the real estate market fluctuates, the whole economy becomes unstable.
What we need is a diversified economic structure that cannot put all our eggs in one basket.
We need to make the manufacturing, service industry, and technology industries thrive, so that the economy can be more stable and free from external influences.
Instead of being like now, the entire economy was led by the nose by the real estate market.
The government has also adopted a series of policy measures to curb the rapid rise in housing prices.
Measures such as purchase restrictions and loan restrictions have been introduced one after another, trying to stabilize the market through supply-side and demand-side regulation.
However, these policies have suppressed the frenzy of the market to a certain extent, but they have also brought certain side effects.
Some investors began to wait and see due to the impact of the policy, and market trading cooled down further, resulting in a decline in trading volume.
Home buyers are generally on the sidelines about the increased uncertainty in the market, which further exacerbates the coldness of the market.
Second, people don't buy houses because they don't have money
Professor Yao Yang's views are indeed quite controversial, but to a certain extent, they have also led to thinking about the relationship between housing prices and the psychology of home buyers.
Conventional wisdom is that the purchasing power of home buyers determines their willingness to buy a home, and the level of housing prices mainly depends on market supply and demand and macroeconomic factors.
However, Professor Yao's argument shifts the focus from the economic power of home buyers to the changes in housing prices themselves, emphasizing the impact of housing prices on home buyer behavior.
Professor Yao Yang believes that the decline in housing prices can stimulate the enthusiasm of home buyers, thereby driving the recovery of the market.
At the heart of this argument is that high house prices may lead buyers to wait and see the market, as they fear that the value of the property they are buying will suffer due to market volatility.
Conversely, when house prices fall to a relatively reasonable level, home buyers will feel the opportunity and advantage of entering the market, and will be more willing to buy the property.
This psychological change can drive market demand and promote the market to be reactive, forming a virtuous circle.
Professor Yao Yang's point also emphasizes the importance of housing prices themselves as market factors.
Conventional wisdom tends to view housing prices as a passive variable, subject to market supply and demand and the macroeconomic environment.
However, Professor Yao Yang believes that the change in housing prices itself can also be an active factor affecting the market.
When house prices fall, it is not only because the wait-and-see of home buyers is broken, but more importantly, because the fall in house prices will trigger a re-evaluation of the market and a change in the expectations of home buyers.
This movement will generate positive market sentiment, which in turn will affect the behavior of homebuyers and the direction of the market.
Professor Yao Yang's views also face some doubts and challenges.
First of all, the decline in home prices, while it may stimulate enthusiasm for home purchases, does not mean that buyers will immediately enter the market.
There are many factors involved in the decision to buy a home, including financial strength, employment stability, family planning, etc., and changes in housing prices are just one of them.
The fall in house prices could trigger panic in the market, leading to further deterioration of the market rather than a recovery.
Therefore, Professor Yao Yang's views need to be further verified and demonstrated in practice.
Third, the money-making effect of the real estate market has been lost
With the continuous rise and fall of housing prices, the value of real estate investment, which was originally stable, has also quietly deviated.
Everyone thinks that real estate is an ironclad livelihood, and the return on investment can be steadily earned.
But now that house prices are rising, investment buyers are finding that the rate of return is getting lower and lower, and even losing money has become commonplace.
As a result, they have chosen to withdraw or wait and see, and are no longer as active as in the past.
And those who really need to buy a house are forced to be anxious.
After all, they are not for investment, but for housing needs, but now housing prices are soaring like a roller coaster, which is simply unbearable pressure! This situation not only disrupts the balance of supply and demand in the market, but also makes the psychology of home buyers become anxious and exhausted.
The government has used a variety of means, such as raising the down payment ratio, tightening loan conditions, and limiting the number of homes purchased, to curb the rise in housing prices.
These policies can play a role in controlling housing prices to a certain extent, but they often treat the symptoms rather than the root cause.
Because these policies have not fundamentally changed the supply and demand relationship in the real estate market.
Under the influence of multiple factors such as accelerated urbanization and population growth, the demand for real estate has been in a strong state, while the supply side is constrained by factors such as land supply and policy regulation, resulting in the contradiction between supply and demand is difficult to alleviate.
Professor Yao Yang's views have caused people to think about the nature of the real estate market.
He believes that the root cause of the loss of the money-making effect in the real estate market is the continuous rise in housing prices.
At the heart of this view is an in-depth analysis of the reasons behind the rise in house prices.
As urbanization accelerates and population growth continues, the demand for housing is increasing, while the supply of the real estate market has not kept up.
Especially in some first-tier cities and hot spots, the supply of real estate has been relatively tight due to the limited land resources and the restrictions of policy regulation.
This has led to a continuous rise in housing prices, attracting a large influx of investors, creating an atmosphere of speculation.
In this case, although the government's regulatory policies can control the rise of housing prices to a certain extent, it is difficult to change the basic supply and demand relationship in the market.
Professor Yao Yang's point of view provides a new idea and direction, that is, to analyze the changes and adjustments of the market from the changes in housing prices themselves.
Conventional wisdom tends to attribute market changes to supply and demand and the macroeconomic environment, ignoring the impact of housing prices themselves as market factors.
Epilogue:
Professor Yao Yang's views have triggered in-depth thinking and discussion on the real estate market.
He believes that housing prices need to be adjusted to a reasonable price range that is consistent with residents' income in order to stimulate enthusiasm for buying houses, and proposes that the ratio of housing prices to residents' income and the ratio of housing prices to rents are important indicators.
Although there are still some discussions about his views, his in-depth analysis and suggestions for the real estate market are worthy of our serious consideration and reference.
With the continuous development and adjustment of the domestic real estate market, it is believed that under the guidance of the government, the market will gradually return to a steady and healthy development track.
Resources:
Yao Yang, "System and Efficiency: Dialogue with North", "Government Behavior and China's Economic Structure Transformation"