China News Service, Beijing, January 17 (Reporter Pang Wuji) Since the second half of 2021, due to the liquidity risk of individual housing companies, the virtuous circle of China's real estate industry has been broken, and the market has cooled rapidly after a rapid rise.
How does the real estate industry defuse risks and achieve a "soft landing"?
Ni Pengfei, director of the Urban and Competitiveness Research Center of the Chinese Academy of Social Sciences, pointed out at the "2022 China Economic Situation Analysis Conference" hosted by China News Agency on the 17th that the "soft landing" of the real estate market can be achieved through the orderly release of local risks. , which would also lead to a more virtuous cycle of real estate, finance and macroeconomics.
Ni Pengfei pointed out that the stock risks in the real estate market do exist and are worthy of vigilance.
However, in recent years, especially under the influence of a series of measures since 2018, the housing price-to-income ratio has dropped, the debt ratio of housing companies has dropped, and the proportion of financial institutions' real estate credit has dropped, and the overall risk has been reduced.
In 2021, local risks will be exposed, mainly due to the increased risks of individual leading private enterprises.
But it must be emphasized that this is a local risk, and the operating conditions of central enterprises, state-owned enterprises and most medium-sized private real estate development enterprises are good.
This actually creates conditions for resolving the risks of individual head companies. For example, the financial sector now encourages mergers and acquisitions.
Ni Pengfei pointed out that real estate risks should be viewed dialectically.
Risk release is a good thing at a certain level. If local risks can be released in a controlled and active manner, this is an important way to reduce overall risks, and it will also help real estate achieve a "soft landing".
In this process, Ni Pengfei emphasized that there are two keys: one is to keep the bottom line of no systemic risks; the other is to adopt a market-based and legal-based approach for individual venture companies, allowing them to undertake and digest them internally.
Because the relevant market entities are "willing to gamble and admit defeat" when making investment decisions, this responsibility cannot be pushed to banks, financial departments, upstream and downstream enterprises, and direct stakeholders must first take this risk.
Of course, this process requires effective isolation to prevent local risk spillovers.
Regarding the changes in the positioning of the real estate market, Ni Pengfei said that in the past few years, the real estate industry has had some problems of excessive development, and the subsequent real estate industry can neither "go forward" nor "retreat", but maintain a steady cooling trend.
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