Image source: Visual China
China's real estate market, which has been in place for many years, is exiting at the rate of two provincial capitals in a day.
On May 9, Hangzhou threw out a "nuclear bomb" policy, that is, the complete cancellation of housing purchase restrictions in one step, and Xi'an soon announced that residents would no longer review the qualifications for purchasing new commercial housing and second-hand housing in the city. At present, in addition to the four first-tier cities of Beijing, Shanghai, Guangzhou and Shenzhen, only Hainan Province and Tianjin City are left in the provinces or cities that have not completely liberalized the purchase restriction policy.
As far as Hangzhou is concerned, as a "new first-tier city", its performance in the real estate market has been at the forefront of major cities all year round, especially in the land market, and it has been the city with the highest number of land sales and land sales income since 2016. Therefore, the comprehensive cancellation of the purchase restriction policy in Hangzhou is of symbolic significance, and the threshold for settlement is lowered, and the purchase of a house can be settled, which has a positive effect on maintaining the stability of Hangzhou's property market. However, limited by the supply scale and structure of Hangzhou's property market, it is expected that it will be difficult to achieve a significant rebound in transaction volume in the short term.
Unlike Hangzhou, the Xi'an property market has maintained a good momentum this year, and both sales and local auctions are picking up. After the lifting of purchase restrictions, Xi'an's real estate market activity is expected to rise further. There is no doubt that the purchase restrictions are fully withdrawn from China's real estate market, so how will the four first-tier cities that are "the only ones left" respond? Is there a real turning point in China's real estate market? Fortune Plus users have had a wonderful discussion on this topic, and we have selected some of them as follows:
Three miles to find smoke
Since the beginning of this year, many cities have openly or secretly fully liberalized purchase restrictions, among which the cities that have taken a bigger step and are more anxious are generally the cities that have risen fiercely in the last round of housing price increases. For example, in Hangzhou, two or three years ago, everyone was still scrambling for new houses, and now the purchase restrictions have been fully relaxed, which can be said to have taken a sharp turn. And in addition to the full liberalization of purchase restrictions, Hangzhou is also implementing the old for the new, stimulating everyone to replace real estate, from this series of combination punches can be seen, Hangzhou is really anxious. (See more "Can Hangzhou's Comprehensive Cancellation of Housing Purchase Restrictions Reverse the Decline of the Property Market?") >> Wonderful interpretation)
Knowledge
Hangzhou's abolition of housing purchase restrictions this time is quite a big step, and it is directly said that you can settle down when you buy a house, which is quite attractive to many young people. After all, the city has a thousand-year-old charm, beautiful scenery, and a strong modern atmosphere, and it is mainly the core concentration of the Internet celebrity economy. Coupled with the fact that the restrictions on housing purchases have now been lifted, it will attract more young people to buy houses and settle here. (See more "Can Hangzhou's Comprehensive Cancellation of Housing Purchase Restrictions Reverse the Decline of the Property Market?") >> Wonderful interpretation)
谭浩俊
Financial commentator
Recently, there has been a new round of "blowout" in the adjustment of real estate market policies, especially in Beijing, which has optimized and adjusted the purchase restriction policy for the first time since 2011. Other first-tier cities have also adjusted and optimized their policies in terms of purchase restrictions. Second-, third- and fourth-tier cities have taken greater steps in policy adjustment and broadened the scale. The purpose is to release residents' enthusiasm for buying houses, accelerate the digestion of stock housing, alleviate the financial pressure of developers, and avoid new risks.
Indeed, one of the biggest risks in the current real estate market is whether there will be a risk of capital chain breakage for developers. The reality is that due to the continuous decline in transaction volume, the vast majority of development companies have reached the point of being out of breath. In particular, Vanke, which has always been regarded as the "wind vane" of industry risks, would have been at risk of redemption if it were not for the backing of "state-owned enterprises" and "state-owned assets" behind it. In other words, the risk of the industry's capital chain has not been effectively resolved, and the problems caused by the market downturn and poor sales are still frequent in the development enterprises.
However, it is difficult to understand that in terms of how to solve the problem of market downturn, whether it is the government, banks and development enterprises, they always want to use "small favors" to lure residents to buy houses, but do not want to touch the interests of development enterprises. For the majority of residents, whether they will buy a house is most closely related to housing prices in addition to their own needs. The policies introduced by the government, the preferential interest rates given by banks, and various prizes for development enterprises can only be an inducement to buyers who need to buy a home, and there is no attraction for those who are hesitant. If you want to unleash those potential demand, only housing prices can have the desired effect. Either the price will rise, which will cause residents to panic, or the price will be lowered to a level that can stimulate residents to buy houses.
It is precisely because of this that we can expect whether policies such as the relaxation of purchase restrictions and "trade-in" can have a positive effect on residents' housing purchases, but we should not expect too much. These policies and measures cannot be ineffective, nor can they have an obvious effect. In the case that the economy has not fully recovered, employment is still very difficult, and residents' income lacks good expectations, the probability of expecting to activate residents' housing demand through policy measures is not too high, and the effect will not be too good. Whether the real estate market can get out of the downturn and whether the market demand can be released mainly depends on the attitude of the post-90s, post-95s and post-00s. As long as their attitude does not change, it will be difficult to change the sluggish state of the real estate market. The actions of this group depend on employment and income, and if this problem is solved, it is still possible to buy a house according to their attitude towards life. On the contrary, it is more difficult to get them to buy a house than to ascend to the sky. (See more "Can Hangzhou's Comprehensive Cancellation of Housing Purchase Restrictions Reverse the Decline of the Property Market?") >> Wonderful interpretation)
Faint
Hangzhou's move is still quite fast, although it is difficult to say whether this trick is still useful or not. With Hangzhou, Nanjing and Wuhan deciding to settle down, Shanghai is also eager to try to relax further, and if it is not completely liberalized now, buyers with purchasing power will soon be sucked away by the more competitive cities in the surrounding area. (See more "Can Hangzhou's Comprehensive Cancellation of Housing Purchase Restrictions Reverse the Decline of the Property Market?") >> Wonderful interpretation)
Wang Lei
Senior market strategy consultant and business columnist
Hangzhou and Xi'an have successively lifted all housing purchase restrictions, and the speed of this policy also reflects the current development of the real estate market. We often say that understanding China's real estate market also understands the trajectory of China's economic development from another perspective. Therefore, this issue can be explored from two dimensions: expectation and market law.
First of all, whether it is the current Hangzhou and Xi'an, or the future liberalization of real estate policies in Beijing, Shanghai, Guangzhou and Shenzhen, they are fundamentally inseparable from a premise - expectations. Economic growth expectations and housing market expectations are actually interactive, and this interaction shows a positive correlation in most cases, and a negative correlation in only a few distortions. Therefore, it is important to raise the expectations of consumers, businesses and investors for future economic growth, which will also directly affect the healthy and vigorous development of the real estate market. Market expectations are actually confidence, which makes us feel the profound connotation of a sentence 16 years ago - "confidence is more important than gold". At present, we need to raise expectations from multiple angles and aspects, which may be the most needed, important and urgent problem to be solved.
Secondly, it is still the same sentence: believe in the power of the market, believe in the power of the laws of the market. The market plays a fundamental role in the allocation of resources, and the same is true in the real estate market. Does the complete lifting of purchase restrictions in Hangzhou and Xi'an mark a major turning point in the real estate market? We are cautious about this. No matter how the policy is regulated, there is one thing that needs to be affirmed - the real estate regulation policy needs to be gradually reduced or withdrawn in a stable and orderly manner under the basic guidance of the market.
Regulation and control policies are always better than "more", because when we look at the power of market laws from a period of time, we will find that its power is far greater than the power of policy regulation. (See more "Can Hangzhou's Comprehensive Cancellation of Housing Purchase Restrictions Reverse the Decline of the Property Market?") "Wonderful Interpretation) (Fortune Chinese Network) Editor: Liu Lanxiang
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