From "buying a house to settle down" to "renting a house to settle down", the competition for talents in many places has escalated

China Business News

2024-06-01 07:50Published on the official account of Beijing China Business Daily

Reporter Huang Yongxu reports from Xi'an

"Abolish the lower limit of mortgage interest rate", "reduce the down payment ratio to a minimum of 15%", "buy a house and settle down"...... Recently, the real estate industry policies have been frequently issued, and the property market policies of the first and second-tier hot cities have been updated, and the adjustment of the household registration policy, which is closely related to the property market policy, also reveals that the competition for talent resources between cities has escalated again.

In May, Nanjing, Hangzhou, Hefei, Shenyang, Foshan and other cities have successively adjusted their property market policies, relaxed the settlement policy, lowered the threshold for settlement, and clearly supported the policy of "buying a house to settle down" or even "renting a house to settle down", absorbing foreign population, seeking to expand residents' demand for housing purchases, so as to promote the digestion of property market inventory.

Bai Wenxi, vice chairman of the China Enterprise Capital Alliance, said in an interview with a reporter from China Business News that there is a close relationship between the property market policy and the household registration policy, and the two interact with each other. With the transformation and upgrading of China's economy, talents have become a key resource for urban development. The "competition for talent" has promoted talent mobility and urban development to a certain extent, but it may also lead some cities to overrely on population growth and neglect sustainable development. It is suggested that cities should pay more attention to the cultivation and retention of talents while "grabbing talents" to improve the competitiveness of local talents.

Purchase limit adjustments

On May 17, the central bank's real estate financial policy "three arrows" at the same time. On the same day, the National Bureau of Statistics also released the changes in the sales prices of commercial housing in 70 large and medium-sized cities in April 2024. The data shows that in April, the sales area and amount of newly built commercial housing across the country decreased significantly year-on-year. The adjustment trend of the real estate market has not changed, and the housing prices in all tiers of cities continue to decline.

Among them, the sales price of newly built commercial residential buildings in first-tier cities decreased by 0.6% month-on-month, an increase of 0.5 percentage points from the previous month. The sales prices of newly built commercial residential buildings in second- and third-tier cities decreased by 0.5% and 0.6% month-on-month respectively, with the decline rate both increasing by 0.2 percentage points from the previous month.

In terms of second-hand housing, in April, the sales price of second-hand housing in first-tier cities fell by 1.1% month-on-month, an increase of 0.4 percentage points from the previous month. Second-hand residential sales prices in second- and third-tier cities both fell by 0.9% month-on-month, and the decline rate increased by 0.4 percentage points from the previous month.

Based on the declining property market, many places across the country have followed up the "5.17 New Deal", and many first- and second-tier cities continue to adjust their property market policies, especially the "housing and household linkage" between real estate policies and household registration policies.

At present, the three first-tier cities of Shanghai, Guangzhou and Shenzhen have optimized the property market policies from multiple dimensions, adjusted purchase restrictions, lowered the threshold for non-local residents to buy houses, and supported the provident fund to pay the down payment.

On May 27, the four departments of Shanghai jointly issued the "Notice on Optimizing the Policies and Measures for the Stable and Healthy Development of the Real Estate Market in Shanghai", which clearly adjusted and optimized the housing purchase restriction policy.

Optimize the conditions for non-Shanghai residents to buy houses, and shorten the number of years for non-Shanghai residents to pay social security or individual income tax when buying houses. The number of years for non-Shanghai residents to pay social security or individual income tax for purchasing a house will be adjusted from "continuous payment for 5 years or more" to "continuous payment for 3 years or more", and the purchase of housing by non-Shanghai talents in key areas such as Xincheng and the North-South Transformation will be adjusted accordingly from "continuous payment for 3 years or more" to "continuous payment for 2 years or more", and the "requirement of continuous payment for 1 year or more" will continue to be implemented for non-Shanghai talents in the Lingang New Area of the Free Trade Zone.

In the optimization of property market policies in second-tier cities, policies such as the full abolition of purchase restrictions, the reduction of down payment ratios, and the reduction of provident fund loan interest rates have been implemented. Compared with the "housing household linkage" in the first-tier cities, which optimizes the housing purchase restrictions, the "housing household linkage" policy in the second-tier cities is more thorough and radical, and the model of "buying a house and settling down" or even "renting a house to settle down" has emerged.

Wang Peng, an associate researcher at the Beijing Academy of Social Sciences, said that because the qualifications for buying a house in some cities are linked to household registration, the hukou policy often determines who can buy a house in a particular city. The adjustment of property market policies, such as purchase restrictions and loan restrictions, will directly affect the purchasing ability and willingness of home buyers, thereby indirectly affecting the choice of household registration relocation.

"When the property market policy is relaxed, such as the lifting or relaxation of purchase restrictions, it may attract more migrants to buy houses and settle down, thereby promoting the growth of the registered population. The relaxation of the hukou policy, such as lowering the threshold for settlement, will attract more home buyers to enter the market, expand the demand for home purchases, and thus boost the property market. Wang Peng said that the real estate policy and the household registration policy complement each other, and the reasonable "housing linkage" is conducive to achieving a positive situation of attracting population inflow and the property market to digest inventory.

Settle loosely

The reporter combed and found that in May, many cities across the country have successively launched the policy of buying or renting a house to settle down, including Hefei, Nanjing, Foshan, Shenyang and other cities. Moreover, the list of cities that have relaxed restrictions on settlement is gradually spreading to hot second-tier cities.

Following the lowering of the threshold for points settlement in February, Nanjing once again relaxed the settlement requirements. After a lapse of 6 years, Nanjing's policy of restarting "buying a house and settling down" has attracted much attention. On May 11, the Nanjing Municipal Public Security Bureau issued the "Notice on Matters Concerning the Settlement of Legal and Stable Domiciles", which mentioned that the conditions for settlement will be further relaxed, and non-Nanjing household registration personnel who have a legal and stable residence in the city and actually reside in the city can directly apply for settlement.

In 2023, Nanjing will have a permanent population of 9.547 million, and the goal of the "14th Five-Year Plan" is to exceed 10 million and enter the ranks of megacities. After the "seven-person census", Nanjing's population increase has ranked first in the province for three consecutive years. In 2023, Nanjing's new population will be 55,900, less than 500,000 short of the target of 10 million people.

On May 15, the official WeChat public account of "Hefei Release" issued the "Notice of Hefei City on Further Adjusting and Optimizing Real Estate Policies and Measures", which introduced property market regulation policies from ten aspects, such as the implementation of housing purchase subsidies and the optimization of sales policies. Among them, the most eye-catching is that "buying a house can realize the whole family settlement".

In just 5 days, Nanjing and Hefei, two hot second-tier cities, have successively optimized the settlement policy and launched the policy of "buying a house and settling down", which is considered by the industry to be a relaxation of settlement conditions, attracting young people and new citizens to settle down, and releasing the domestic demand and consumption potential of the property market.

However, in the competition for talents, there are cities that are more radical than Nanjing and Hefei's "buy a house and settle down" policy, and have launched a "rent to settle down" policy.

On May 12, the General Office of the Shenyang Municipal People's Government issued the "Several Policies and Measures to Further Promote the Settlement of Migrant Population in Shenyang", which clearly stated that you can settle down in Shenyang by renting housing. Non-resident residents who rent housing in urban areas of Shenyang can settle down in Shenyang for themselves and their close relatives.

On May 13, Foshan City issued a new policy, making it clear that from now on, you can enter the household by holding Foshan real estate. In addition, it is pointed out in the subsequent policy that non-household registration personnel who have been legally and stably employed in the city for 3 years (paying social insurance for 3 consecutive years, or doing business for 3 consecutive years, which can be complementary) and have a legal and stable residence (including lease) can apply for household registration.

Wang Peng said that with rising costs and increased competition in first-tier cities, second-tier cities see an opportunity to improve their competitiveness by attracting talent. In the long run, the continuous inflow of population and talents will not only promote the upgrading of urban industries, but also provide more housing demand for the property market, which is conducive to the development of the property market.

Bai Wenxi said that the policy trend from "buying a house to settle down" to "renting a house" reflects the deepening understanding of population mobility and housing demand in China's urbanization process. The change in policy also shows that policymakers have begun to pay attention to the development of the rental market, realizing that renting can also meet the housing needs of residents, and help alleviate the pressure of buying houses and promote the healthy development of the real estate market.

Population Dispute

In recent years, various localities have introduced various talent policies or policy packages to attract college graduates and high-quality talents to settle in the local area, so as to enhance the connotation quality of local economic and social development and the competitiveness of cities.

Nowadays, the real estate market is still in a state of adjustment, and many hot cities have relaxed the settlement policy to attract foreign people to buy houses.

Why do many second-tier cities have introduced preferential talent policies, opened the window of "buying a house to settle down" and "renting a house to settle down", and devoted themselves to the white-hot "talent competition"?

Bai Wenxi said that the root cause of second-tier cities joining the "competition for talent" is the need for urban competition and industrial development. With the transformation and upgrading of China's economy, talents have become a key resource for urban development. In order to attract talents and enhance their competitiveness, cities will attract talents by providing preferential settlement policies, improving public services, and providing career development opportunities. In addition, industrial development needs the support of corresponding talents, and second-tier cities can provide human resources guarantee for the development of local industries and promote the optimization of economic structure and industrial upgrading by "grabbing talents".

Wang Peng believes that "grabbing talents" reflects the thirst for talents and development aspirations of second-tier cities, and is a manifestation of competition between cities. By attracting talent and the inflow of foreign population, it is conducive to accelerating the city's economic development and industrial upgrading, and improving the city's competitiveness.

Of course, if the "war for people" is not enough to achieve population inflow and permanent population growth, the key lies in how to retain and use people?

Bai Wenxi suggested that cities should do a good job in follow-up supporting work and improve the public service system, such as education, medical care, transportation, etc., to meet the needs of the new population; Optimize the employment environment, create more job opportunities, and provide vocational training and entrepreneurship support; Promote the reform of the same rights for rent and sale, and protect the basic residence rights of residents.

Wang Peng believes that while attracting talents, cities should pay attention to improving their own strength and service level to retain talents and play their role. Increase government investment, improve the level of urban infrastructure and public services, and provide a better living and development environment for talents.