May 17 is probably one of the happiest days for many developers in the past two years.
The capital market is the most immediate response.
On May 17, Vanke A, Greenland Holdings, Poly Development, Gemdale Group, I Love My Home, and Special Services rose by 20%, and the World Union Bank and BII Development were also close to the daily limit.
In terms of Hong Kong stocks, Evergrande Property rose 34.33%, Sunac China rose 25.85%, Agile rose 24.32%, Longfor Group rose 10.87%, R&F Real Estate rose 12.71%, Jingrui Holdings rose 114.29%, Yuzhou Group rose 28.43%, Territory Holdings rose 31.94%, LVGEM China rose 17.07%, and Jingrui Holdings soared 238.1%.
From the stock price performance of these developers, it can be seen that the market is very satisfied with the policies released by the central bank and relevant departments yesterday.
Yesterday, many departments, including the central bank, successively released five big moves to support the development of the property market, which is unprecedented.
The first move is to reduce the interest rate of the provident fund.
Starting from May 18, the national reserve interest rate will be reduced by 0.25 percentage points. Among them, the interest rate of the first set of personal housing provident fund loans for less than 5 years (including 5 years) and more than 5 years is adjusted to 2.35% and 2.85% respectively, and the interest rates of the second set of personal housing provident fund loans for less than 5 years (including 5 years) and more than 5 years are adjusted to not less than 2.775% and 3.325% respectively.
The second move is to liberalize the lower limit of interest rates.
In the past, except for those cities where house prices fell for three consecutive months on a month-on-month and year-on-year basis, the lower bound of interest rates in other cities ranged from 20 basis points to 50 basis points.
However, starting from May 18, interest rates in all cities across the country are no longer subject to the lower limit, whether housing prices rise or fall, and all localities can set their own prices according to the actual situation of the market.
The third trick is to reduce the down payment ratio.
According to the new policy, the minimum down payment ratio for the first home can be 15%, and the minimum down payment ratio for the second home can be 25%, which is almost halved, which means that everyone's down payment funds have decreased, and the leverage efficiency will be more obvious.
Fourth, local governments are allowed to acquire existing real estate.
At a multi-departmental meeting held yesterday afternoon, it was clearly stated that supporting local state-owned enterprises to purchase unsold commercial houses at reasonable prices for use as affordable housing for sale or rent is equivalent to local governments buying houses in person, which is bound to drive the growth of housing sales.
The fifth move is to issue special loans to support state-owned enterprises to acquire existing real estate.
At present, the financial pressure in many places is relatively large, and it is estimated that it is unrealistic to let the government pay for the purchase of houses out of its own pocket, so the central bank has issued a special reloan of 300 billion yuan to support local state-owned enterprises to acquire existing real estate, and the refinancing interest rate is very low, only 1.75%.
It can be said that the policies launched on May 17 are very practical policies, which are great benefits for both developers and home buyers.
Coupled with the continuous decline in the LPR, as well as the lowering of the threshold for buying a house in various places, and even the cancellation of purchase and sale restrictions, and the direct granting of cash subsidies and other support policies, it can be said that the current policy of the property market is unprecedented, and I have never seen such a strong support policy before.
This also fully shows the country's determination to stabilize the property market, especially in ensuring the delivery of housing, the country is really well-intentioned.
In the context of the continuous release of good news in the property market, everyone feels that the property market should rebound.
After all, the property market has indeed been sluggish in recent years, especially since entering 2024, and various data have continued to decline.
According to the latest data released by the National Bureau of Statistics on May 17, from January to April 2024, the national real estate development investment will be about 3.09 trillion yuan, a year-on-year decrease of 9.8%, which is also the largest decline in recent years, and this is the 23rd consecutive month of negative growth in developer investment growth.
In addition, from January to April 2024, the sales area of newly built commercial housing was 293 million square meters, a year-on-year decrease of 20.2%, of which the sales area of residential buildings decreased by 23.8%.
From these data, it can be seen that the current property market is indeed not too optimistic, fortunately, the country has introduced favorable policies in a timely manner, and has given all-round support from the policy capital market, if the property market does not rebound this time, then I am sorry for the country.
We also hope that the property market will rebound, which will not only ensure that those who buy off-plan properties can get their homes smoothly, but also allow real estate to return to normal conditions, which is crucial for promoting economic development, stabilizing local fiscal revenues, and creating more jobs.