Introduction: The real estate bull market may really be coming.
On May 17, the central bank, the State Administration of Financial Supervision, the Ministry of Housing and Urban-Rural Development and other departments announced four major measures to rescue the property market in one breath, directly pointing to the provident fund, the second set of interest rates, the down payment of housing loans and the collection and storage of housing.
The first trick: reduce the down payment ratio.
For households that take out loans to purchase commercial housing, the minimum down payment ratio for commercial personal housing loans for the first house is adjusted to not less than 15%, and the minimum down payment ratio for commercial personal housing loans for second houses is adjusted to not less than 25%.
On this basis, the provincial-level branches of the People's Bank of China and the dispatched agencies of the State Financial Supervision and Administration independently determine the lower limit of the minimum down payment ratio for commercial personal housing loans for the first and second houses in each city under their jurisdiction in accordance with the requirements of urban regulation and control and in accordance with the principle of city-specific policies.
The second move: reduce the interest rate of the provident fund loan.
The People's Bank of China decided to reduce the interest rate of personal housing provident fund loans by 0.25 percentage points from May 18, 2024, and 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 will be adjusted to 2.35% and 2.85% respectively, and the interest rate of the second set of personal housing provident fund loans for less than 5 years (including 5 years) and more than 5 years will be adjusted to not less than 2.775% and 3.325% respectively.
The third move: at the national level, cancel the lower limit of the interest rate on the first and second home loans.
The provincial-level branches of the People's Bank of China, in accordance with the principle of city-specific policies, guide the self-discipline mechanism of market interest rate pricing at the provincial level, and independently determine whether to set the lower and lower limits (if any) of the interest rates of commercial personal housing loans in each city within their jurisdiction according to the real estate market situation of each city within their jurisdiction and the regulatory requirements of the local government.
Banking financial institutions should be based on the provincial market interest rate pricing self-discipline mechanism to determine the lower limit of interest rates (if any), combined with the institution's operating conditions, customer risk status and other factors, reasonable determination of the specific interest rate level of each loan.
The fourth trick: in cities with a large inventory of commercial housing, the government can purchase part of the commercial housing at a reasonable price as appropriate.
At the video conference on the work of guaranteeing the delivery of housing held today, Vice Premier He Lifeng of the State Council announced that the relevant local governments should proceed from the actual situation and properly dispose of the idle stock of residential land that has been transferred by means of recovery and acquisition as appropriate, so as to help real estate enterprises with financial difficulties to solve their difficulties. In cities with a large inventory of commercial housing, the government may purchase some commercial housing at a reasonable price as appropriate.
Affected by this news, at the beginning of May 16, real estate stocks were simply "crazy"...... Thunder, thunder, thunder, unified skyrocketing! Today (17th), real estate stocks continued to break out, I love my home continued to rise and fall, Binjiang Group, Chengtou Holdings, Tiandiyuan, World Union Bank, etc.
It has been three years since the real estate bailout was launched, and in 2022 and 2023, there have been a wave of vigorous bailout policy releases.
The focus of the policy is to loosen the restrictions and loosen those previously extremely strict restrictive policies, which mainly include three parts:
First, loosen restrictions on real estate enterprises, reduce the financing difficulty of real estate enterprises, so that enterprises can raise money and survive.
Second, loosen restrictions on home buyers and cancel a series of purchase restriction policies, so that more home buyers can enter the market to buy houses.
Third, loosen loan conditions, such as lowering down payments, lowering interest rates and reserve requirements, so that home buyers can borrow more funds.
However, after the implementation of this series of policies, it will be found that after two or three months of market heat, it will soon cool down again. It's just that this time a few sets of combinations can stimulate the rise in housing prices?
Today's scene, the more you look at it, the more it looks like 2015:
"Mortgage interest rate reduction", "purchase restriction liberalization", "support for trade-in", "tax refund for house purchase", "relaxation of house purchase settlement policy", ...... Recently, the policies introduced to promote the healthy development of real estate are dizzying.
I have to say that from the perspective of policy performance, the appearance is indeed very similar, but the core is different:
In July 2014, Hangzhou began to relax the purchase restrictions, and soon the purchase restrictions were lifted; Subsequently, interest rates began to be cut at the end of 2014, and in 2015, they were lowered five times in a row, and the down payment of 20% for the first home and 30% for the second home started in March 2015, and the cost of buying a house fell to a record low.
In that round, all regulatory policies were liberalized, remember, all.
But even so, from the loosening of the purchase restriction policy in 2014 to the end of 2015, Shanghai and Shenzhen opened the market, there is almost a period of more than a year. Around New Year's Day in 2016, I went to see several second-hand houses in Dawn City and Golden Dawn, and the listing price of 90 square meters was between 1.48-1.55 million, and there was still room for negotiation.
Hangzhou really began to rise in price, is Shanghai, Shenzhen market has been fully launched in the second quarter of 2016, warm wind to really promote the volume and price rise.
Now, the hammer wound of 2021 has not really healed, and although the policy has been loosened, it is still in the tentative stage, and there is no universal benefit, nor has it really completely liberalized all regulatory policies. In particular, the three hard clauses of purchase restrictions, sales restrictions and down payment ratios for house purchases still exist rigidly.
And this time, even if the data in many places is already very bad, the policy is still only a small range of testing, and whether it should really be exhausted in the later stage, but at present, it is not.
It can be seen that the country's attitude towards real estate this time is still very different from that in 2015. On the basis of not violating the general principle of "housing for living, not for speculation," the loosening of the policy is still somewhat restrictive.
The cancellation of purchase and loan restrictions is not surprising, and the national team's collection of savings is an unprecedented new move. This is also the fundamental reason for the continuous surge in real estate stocks in the past two days. This means that the news that the "national team" has begun to collect houses has finally been finalized, and the future Chinese version of the real estate collection and storage model is about to come out.
Since the high-level meeting on April 30 proposed to "study and digest the stock of real estate as a whole", the market has given expectations to "the government to collect and store real estate to ease market pressure". Because if this matter is implemented, it will have a historic inflection point impact on the property market.
According to statistics, in March 2024, the national inventory of second-hand housing is about 4.4 billion square meters, even if the land area to be developed by real estate enterprises is not considered, only the broad inventory of new houses and the effective supply of vacant second-hand houses, the current generalized housing inventory can reach 2.63 billion square meters.
▲ Source: Yitu.com
The repurchase of new houses is simpler than the repurchase of second-hand houses, second-hand houses involve the appraisal price of the house, whether the owner recognizes this price, and it is necessary to negotiate a set, if it is old and dilapidated to buy, and it will be rearranged and rented in the future, which involves a series of troubles.
Once market confidence rebounds, the owners who sold in panic may not sell. Everyone's employment and income will also increase, and the whole market can enter a virtuous circle.
This kind of plan for the state to come out as a repurchaser can really save the property market from fire and water.
The question is, why does the country need to desperately save the market?
In any industry, if the market goes with the market, it is normal for prices to rise and fall, and the bubble formed when it soars can naturally be adjusted by natural bursting.
However, real estate is not an ordinary industry, and it has been tied to the national economy, local finances, and residents' property from the very beginning. The GDP of the real estate industry has continued to decline, which has become the biggest drag on economic growth.
In the first quarter of 2024, the country's GDP grew by 5.3% year-on-year, greatly exceeding expectations, but the real estate sector fell by 5.4% year-on-year, the only one among the 12 major industries. This is the fourth consecutive quarter of negative growth in the real estate sector, the first since the housing reform in 1998.
The real estate trend not only affects itself, but is related to a series of upstream and downstream industrial chains, from the construction industry to building materials, household appliances and other industries, accounting for more than 10% of the economy as a whole.
Considering the existence of land finance, it can be said that real estate is not comparable to other industries in terms of scale and pulling effect.
At the same time, according to the central bank's report, about 70% of the property of mainland households is a house, and about 70% of the debt is also related to a house.
Therefore, whether it is from the level of the national economy or the level of residents' wealth, real estate cannot be easily allowed to fall.