Don't Misread "Definancialization of Real Estate"

  Jin Guanping

  A few days ago, the internal speech of a large real estate company came out, triggering a discussion on the "definancialization of real estate" in the market.

Some voices believe that the financial support of the industry will be greatly reduced in the future, which is a misunderstanding of "de-financialization of real estate".

  It must be pointed out that "de-financialization" is a correction to the previous excessive financialization. Its ultimate purpose is to reduce the operating leverage ratio of real estate enterprises to a reasonable level, optimize the debt structure, and promote the return of real estate to residential and people's livelihood attributes. Avoid regional and systemic risks.

  The problem of "over-financialization" in the real estate industry is embodied in two aspects.

First, real estate development and operation are overly dependent on financial leverage, with high debt, high leverage, and high turnover; second, real estate companies have deployed in the financial field, investing in, holding shares, or even controlling commercial banks, insurance institutions, trust companies, etc., and industrial capital has excessively entered the financial industry. .

  The causes of "over-financialization" are very complex, and the different causes are causal and spiral.

  First of all, the investment property of real estate once surpassed the residential property, triggering speculation, and forming the expectation that housing prices "will only rise and not fall".

Affected by this expectation, housing companies increased leverage to expand, and home buyers worried about buying late, buying small, and borrowing ahead of time to buy a house. These behaviors further solidified the expectation of rising house prices and fell into a vicious circle.

  Secondly, the profit-seeking behavior of financial institutions has deepened the complexity of the real estate financing structure.

Chaos such as "drawer agreement" and "real debts" were once prevalent, and the risk of shadow banking increased, which not only increased the difficulty of dismantling by the regulatory authorities, but also weakened the implementation effect of regulatory policies.

  Third, some real estate companies lack reasonable financing plans, making it difficult to "pre-judgment in advance, follow-up during the event, and review after the event."

Individual managers have the mentality of "make a fortune and run away". During their tenure, they over-financed, spread a lot of money, and even made illegal profits from them.

This has led to a serious imbalance in the debt structure of some housing companies, and their financing behavior has increasingly deviated from their own business development track. Once they encounter tight cash flow, risks are easily exposed.

  Therefore, the core idea of ​​curbing the "over-financialization" of real estate is to adhere to the positioning of "housing and not speculating" and return to the residential attribute of real estate.

  In recent years, regulators have focused on the supply side, aiming to change the exogenous growth model of real estate companies and reduce industry liabilities and risks.

On the one hand, we will continue to carry out chaos rectification actions, and strictly investigate the illegal flow of credit funds into the real estate market; Management System", which requires that the proportion of the bank's real estate loan balance and personal housing loan balance should not be higher than the corresponding upper limit.

  In the process of industry deleveraging, the default risk of individual companies will inevitably be exposed.

In this regard, we must not be in a hurry to turn the policy, otherwise, all previous efforts will be lost.

Adhering to the positioning of "housing for housing, not speculation", it is necessary to actively and prudently dispose of exposed risks; at the same time, keep the growth rate of real estate loans stable and orderly, but in terms of structure, "retention and pressure" must be achieved to accurately and effectively meet the needs of real estate loans. Reasonable rigid financing needs of enterprises and home buyers, and resolutely curb violations of laws and regulations.

  It must be clear that the overall trend of steady and healthy development of my country's real estate market will not change.

Next, we must resolutely implement the decisions and arrangements of the Party Central Committee, conscientiously implement the spirit of the Central Economic Work Conference, adhere to the positioning of "housing, not speculation", and fully implement the long-term mechanism for real estate.

At the same time, strengthen the guidance of expectations, further improve the accuracy of real estate financial policies, and maintain the continuity, consistency and stability of policies.

In addition, it is necessary to explore new development models of the industry, strengthen financial support for the long-term rental market and the construction of affordable housing, and promote a virtuous circle and healthy development of the real estate industry.