Frequent heavyweight policies, gradually showing warmth in the real estate market
2024-05-29
On May 24th, Zhuhai, Guangdong announced the lifting of housing purchase restrictions. At this point, over 20 provinces (regions, cities) in China have abolished housing purchase restrictions. Previously, the People's Bank of China and other departments announced on May 17th that they would lower the minimum down payment ratio for housing loans and lower the interest rate for personal housing provident fund loans. Industry insiders analyze that the recent implementation of multiple real estate policies with strong efforts and close connections is an important measure for the country to promote the healthy development of the real estate market. Since the introduction of these new measures, the number of inquiries and visits to the real estate market in many regions has significantly increased, and the real estate market is gradually showing signs of recovery. On May 24th, the Housing and Urban Rural Development Bureau of Zhuhai City, Guangdong Province, issued several measures to promote the stable and healthy development of the real estate market in our city, which mentioned the cancellation of purchase restrictions and relaxed the threshold for purchasing houses, causing widespread attention. Before Zhuhai announced the lifting of housing purchase restrictions, Hangzhou, Zhejiang and Xi'an, Shaanxi both announced the lifting of purchase restrictions on May 9th. The relevant notice issued by Xi'an City mentions the complete cancellation of housing purchase restrictions, and resident families purchasing new commercial housing and second-hand housing throughout the city will no longer be eligible for purchase. In addition, when selling commercial housing projects, if the ratio of the number of registered households to the number of housing units is less than 1.5:1, no notarized lottery will be implemented. The Office of the Leading Group for the Stable and Healthy Development of the Hangzhou Real Estate Market has issued a notice on optimizing and adjusting the regulatory policies of the real estate market. In addition to mentioning the comprehensive cancellation of housing purchase restrictions, it has also proposed seven measures, including scientifically formulating housing development plans, optimizing residential land supply, optimizing public certificate lottery sales, and strengthening housing credit support. Looking at the timeline, since the beginning of this year, many regions in China have made adjustments and optimizations to the housing purchase restriction policies that have been implemented for many years. On April 28th, the Housing and Urban Rural Development Bureau of Chengdu issued a notice announcing that housing transactions throughout the city will no longer be eligible for purchase; On the basis of implementing the existing housing purchase restriction policy, Beijing allows resident families or adult single individuals who have reached the purchase limit to purchase one new commercial housing unit outside the Fifth Ring Road; Tianjin has lifted the restriction on registered residence residents to buy new houses of more than 120 square meters in six districts of the city. Observing the adjustment and optimization of purchase restriction policies since the beginning of this year, the first step is to cancel purchase restrictions in ordinary second tier cities, and then adjust non core area policies in hot second tier cities and gradually transition to the central area. Subsequently, some first tier cities have also adjusted their housing purchase restriction policies Li Yujia, Chief Researcher of Guangdong Housing Policy Research Center, told our reporter. For example, Guangzhou became the first first first tier city in China to lift the purchase restriction policy for large units of over 120 square meters; Shanghai launched a new policy for talents to settle down in the peripheral areas of the city, shortened the number of years for non registered residence residents to pay social security, and relaxed the threshold for them to buy houses. The effect of adjusting and optimizing the purchase restriction policy quickly spread to the real estate market. Xiao Chen, who works at a sales office outside the East Fifth Ring Road in Chaoyang District, Beijing, told reporters that the units sold at the office are all over 130 square meters. Since the relaxation of housing purchase restrictions outside the Fifth Ring Road in Beijing, the number of homebuyers visiting for consultation has increased by 2 to 3 groups on a daily basis, all of whom are improvement oriented customers. The second-hand housing market is also showing a trend of recovery, especially in first tier cities where purchase restrictions have been relaxed. A staff member of a housing agency in Chaoyang District, Beijing told reporters that after the relaxation of purchase restrictions in Beijing, the number of inquiries in stores has increased by more than 50% compared to last month, and the number of visits has also increased by nearly 50% compared to last month. According to data released by real estate brokerage firm Lianjia, during this year's May Day holiday, the daily average transaction volume of second-hand houses in Beijing, Chengdu, and Tianjin increased by 43%, 28%, and 19% year-on-year, respectively. According to data from Zhongyuan Real Estate Research Institute, from May 18th to 19th, the daily transaction volume of second-hand houses in Beijing exceeded 1000 units, basically reaching the level of "little spring" in the real estate market this year. Since the reduction of loan interest rates and down payment ratios, as well as the optimization and adjustment of housing purchase restrictions in many areas, the housing market has experienced three major "reductions" on May 17th - lowering the minimum down payment ratio for housing purchases; Lowering the lower limit of the housing loan interest rate policy; Reduce the interest rate of provident fund loans. According to the Notice on Adjusting the Minimum Down Payment Ratio Policy for Personal Housing Loans issued by the People's Bank of China and the State Administration of Financial Supervision, for residential families who purchase commercial housing with loans, the minimum down payment ratio for commercial personal housing loans for their first home is adjusted to no less than 15%, and the minimum down payment ratio for commercial personal housing loans for their second home is adjusted to no less than 25%. In addition, the lower limit of commercial personal housing loan interest rates for first and second homes at the national level will be abolished. In terms of housing provident fund loans, starting from May 18th, the interest rate for personal housing provident fund loans will be lowered by 0.25 percentage points. The interest rates for personal housing provident fund loans for first homes under 5 years (including 5 years) and over 5 years will be adjusted to 2.35% and 2.85%, respectively. The interest rates for personal housing provident fund loans for second homes under 5 years (including 5 years) and over 5 years will be adjusted to not less than 2.775% and 3.325%, respectively. The relevant person in charge of the Housing Provident Fund Supervision Department of the Ministry of Housing and Urban Rural Development has calculated that, taking a personal housing loan for the first housing provident fund of 1 million yuan with a term of 30 years as an example, choosing the equal principal and interest repayment method, the monthly payment will be reduced from 4270.16 yuan to 4135.57 yuan, a decrease of about 135 yuan, and the total interest expenditure will be reduced by 48500 yuan. "The benefits that homebuyers receive are tangible," said the person in charge. According to relevant notices, various regions may make certain adjustments to local policies based on the principle of implementing policies according to the city. For example, each region can independently determine the minimum down payment ratio for commercial personal housing loans for the first and second homes in its respective cities. In terms of lowering the lower limit of housing loan interest rates, it is possible to independently determine whether to set the lower limit and lower level of commercial personal housing loan interest rates in each city within the jurisdiction based on the real estate market situation and local government regulatory requirements (if any). Banking and financial institutions should reasonably determine the specific interest rate level for each loan based on the lower limit of interest rates determined by the self-discipline mechanism of market interest rate pricing at each provincial level (if any). The reporter noticed that since the release of housing related financial policies a week ago, multiple cities across the country have followed up on adjustments. In Hubei, the minimum down payment ratio for the first home is adjusted from no less than 20% to no less than 15%, and the minimum down payment ratio for the second home is adjusted from no less than 30% to no less than 25%. The minimum down payment ratio for housing loans has also been adjusted in cities such as Chongqing, Shaanxi, and Shanxi. Looking at the changes in housing provident fund loan interest rates again. On the same day that the People's Bank of China issued a notice, Zhengzhou, Luoyang, Kaifeng and other places in Henan Province announced a clear reduction in the interest rate of provident fund loans. Jiangxi, Chengdu in Sichuan, Chongqing, Guangzhou in Guangdong, and Dongguan announced a reduction in the interest rate of provident fund loans starting from May 18th. It is worth noting that according to the notice of the Housing Fund Management Center of the Xizang Autonomous Region, for the first house buyers, the interest rate of provident fund for less than five years (including five years) and more than five years is adjusted to no less than 1.36% and 1.68% respectively; The corresponding housing provident fund interest rates for second homes have been adjusted to not less than 1.686% and 2.038%, respectively. This means that the interest rate of provident fund loans in Xizang has entered the "first era", becoming the area with the lowest interest rate of provident fund loans at present. From the perspective of market performance, some cities have shown a clear recovery trend in the real estate market after the introduction of the new policy. According to a research report released by the Kerui Research Center, key cities are experiencing a point wise recovery. Taking Shanghai as an example, from May 18th to 19th, the number of second-hand residential transactions reached 806 and 743, higher than the daily average of 609 and 654 in April and March this year. The report believes that the new policies of "reducing down payment ratio, canceling the lower limit of interest rates, and lowering housing provident fund interest rates" have indeed boosted the confidence of homebuyers in the short term, and the activity of real estate markets in various regions has also increased to varying degrees. The current transaction volume of the new housing market has rebounded from a low level, but it is currently lower than the high point in March. The second-hand housing market, due to its high heat in the early stage, is currently experiencing a point like recovery in some cities. The recent introduction of a series of new policies in the real estate market is closely related to the new situation of significant changes in the supply and demand relationship in the real estate market, including the cancellation of purchase restrictions, the reduction of housing purchase thresholds, the lowering of down payment ratios, and the lower limit of mortgage interest rates. "The strict real estate regulation policies in the past were formulated to curb speculative investment in the face of a shortage of supply and continuous rise in housing prices." Zhao Xiuchi, Dean of the Beijing Tianjin Hebei Real Estate Research Institute at Capital University of Economics and Trade, told our reporter that the recent new policies have relaxed restrictions on homebuyers, such as reducing down payment ratios and lifting purchase restrictions, making it possible for homebuyers with different needs to purchase a house; On the other hand, measures such as lowering interest rates have reduced the repayment burden for homebuyers, improved their purchasing power, and are more conducive to promoting the entry of demand for essential and improved housing into the market. "From the perspective of market performance, after the introduction of the new policy, the number of visits and consultations for houses in multiple regions has increased, and the transaction situation has also slightly improved, but overall it has not been fully reflected. This is because there will be a certain delay period from the policy's release to its implementation. In addition, homebuyers not only consider policy factors when making home purchase decisions, but also comprehensively measure household income level, repayment ability, and whether housing can maintain and increase value as the largest asset of the family. Therefore, the overall effect of the new policy still needs further observation," Zhao Xiuchi said. While lowering the threshold for homebuyers, measures to alleviate difficulties for real estate companies are also being intensively introduced. At the routine policy briefing of the State Council held on May 17th, Dong Jianguo, Deputy Minister of Housing and Urban Rural Development, stated that we must fight the battle of ensuring the delivery of urban commercial housing projects, prevent and dispose of the risk of unfinished projects, promote timely and high-quality delivery of projects, and enable the people to obtain qualified houses as agreed in the contract on time. For some existing commodity housing, urban governments adhere to the principle of "purchasing according to demand" and can organize local state-owned enterprises to purchase a portion of existing commodity housing at a reasonable price for use as affordable housing. At the briefing held on the same day, Tao Ling, Vice President of the People's Bank of China, stated that a 300 billion yuan re loan for affordable housing will be established. Encourage and guide financial institutions to follow the principles of marketization and rule of law, and support local state-owned enterprises to purchase completed but unsold commercial housing at reasonable prices, which will be used as allocated or leased affordable housing. It is expected to drive bank loans of 500 billion yuan. "Acquiring existing land and existing commodity housing for the construction of affordable housing not only reduces the supply of commodity housing, balances the supply and demand relationship in the commodity housing market, but also increases the supply of affordable housing, reducing waiting times for more beneficiaries and achieving 'all that should be guaranteed'." Zhao Xiuchi said, "At the same time, the government's acquisition of some existing commercial housing can help real estate enterprises recover a certain amount of funds and help them overcome difficulties. Implementing a real estate financing mechanism can help real estate development enterprises raise funds from multiple sources, restore the function of capital transfusion and blood production, ensure timely delivery of housing, and thus ensure the stable and healthy development of the real estate market." (Li Xinshe)
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