Heavy! The signal of property market stability maintenance was released, and the central bank clearly defined the "two maintenance" to stabilize market expectations

The Third Quarter (94th) Regular Meeting of the Monetary Policy Committee of the People's Bank of China in 2021 was held in Beijing on September 24. The meeting stressed that it is necessary to adhere to the general tone of the work of seeking progress in stability, stabilize the word, deepen the structural reform of the supply side, accelerate the construction of a new development pattern, adhere to the strategy of expanding domestic demand, do a solid job in the "six stability" work, fully implement the "six guarantees" task, flexibly and accurately implement monetary policy, strengthen coordination with fiscal, industrial and regulatory policies, coordinate financial support for the real economy and risk prevention, maintain economic operation within a reasonable range, and promote high-quality economic development. At the same time, the meeting pointed out that it is necessary to "maintain the healthy development of the real estate market and safeguard the legitimate rights and interests of housing consumers" .

The first mention of "real estate", clear "two maintenance", stabilize market expectations

According to historical data, the monetary policy committee of the central bank has held a total of 94 regular meetings since 2009, and this third quarter regular meeting is the first time in nearly 12 years that the content of "real estate" has been mentioned.

On the one hand, since the second half of the year, the policy regulation of hot cities has continued to become stricter, since the end of July, more than 30 cities have issued more than 70 regulation and control policies, some cities have increased in the purchase restriction, sales restriction and price limit, market pessimism has risen, the market activity in most cities has dropped significantly, and the market adjustment pressure has increased; at the same time, more than ten cities such as Shenyang, Kunming, tangshan and other cities have issued "restriction orders", and some cities have issued subsidies for talent purchases, raised the amount of provident fund loans, and lowered the tax collection rate of second-hand housing transactions. Various localities have stabilized market expectations due to city policies.

On the other hand, the central government has improved the prudent management of real estate finance, adhered to the "three red lines" and implemented the management of the concentration of real estate loans of financial institutions, the financing of housing enterprises is limited, the amount of superimposed mortgage loans is tight, the lending cycle is extended, the pace of repayment of housing enterprises is greatly affected, and the operating pressure of some housing enterprises is increased. At the same time, the debt risk events of individual large enterprises have led to a further rise in industry pessimism.

In this context, the central bank's monetary policy meeting first mentioned real estate, released a stability maintenance signal, responded to the central government's work tone of "seeking progress in stability" in the second half of the year, adhered to the stability of the real estate market, and safeguarded the healthy development of the real estate market and the legitimate rights and interests of housing consumers, which will play an important role in stabilizing market expectations and boosting market confidence.

It is expected that in the fourth quarter, in order to accelerate the return of funds, housing enterprises will still increase their efforts to push the market, but under the strict control of credit and regulatory policies, the demand for housing is relatively heavy, and the market adjustment pressure is still large. From the perspective of policy strength at this stage, the policy has gradually peaked, and the marginal improvement of the policy in the near future is expected, including the prudent management of real estate finance and market regulation, which may put forward more refined requirements to avoid "one size fits all", and it is expected that in the short term, mortgage loan amounts, lending time, etc. have certain room for improvement, promote the normal release of housing demand, and guide housing enterprises to operate steadily.

But more importantly, in order to achieve the healthy development of the real estate market, the central government has released a signal to maintain stability, and the effect of the policy still depends on the implementation of local governments and financial institutions, including credit support for reasonable housing demand and financial support for the operation of stable housing enterprises, so as to maintain the stable and healthy development of the real estate market.

Table: Comparison of the main contents of the regular meetings of the Monetary Policy Committee of the Central Bank in the second and third quarters of 2021

Knowledge Interpretation:

First, there is no real estate market in China. Different cities are differentiating, different areas between cities are also differentiating, and this differentiation is getting bigger and bigger (this is why some cities continue to "limit the rise" and some cities begin to "limit the fall"). So, if you just talk about the real estate industry, you can use macro thinking. But if you're going to choose a house, be sure to pay attention to the city you're in, the area you're in, whether it's a pie or a trap. But you really don't need to look at the whole chessboard, look at the macro, you will find that never do anything, is the most correct.

Second, don't let emotions lead your money. The rise and fall of the short-term market is dominated by emotions, but the long-term direction of the market will eventually return to the correct pricing. That's why we say that short-term markets are stupid because there will be mispricing, and even if they don't, they'll be like the ones above, and the market won't be crowded anymore. But this is for those who have calmness, courage, and common sense, if you just follow the market sentiment, you can only follow the crowd. If you can avoid the fall, you will also miss the rise. Calmly return to your own needs, work hard to do more meticulous homework, do not give too many assumptions, the results will often be better. When the market is sluggish, it is more important to actively go to the market to take a look, at this time the supply of real estate is large, the mood is sluggish, and the probability of finding good things is greater.