The three forces helped the property market to pick up in January and February, and the trend in the next two months is more critical

Author: Sun Mengfan

How much will the property market recover in 2023? The latest data from the Office for National Statistics provides the answer.

On March 3, Fu Linghui, spokesperson of the National Bureau of Statistics and director of the Department of Comprehensive Statistics of the National Economy, introduced the operation of the national economy in January ~ February 15, saying that under the role of a series of policies, with the warming of the economy, there have been some positive changes in the real estate market this year, mainly reflected in the significant narrowing of the decline in market sales.

"In January ~ February, the real estate sales area fell by 1.2%, which was significantly narrower than last year. Sales declined by 3.6 percent, also narrowing significantly. Real estate enterprises are also improving in terms of funds in place and investment starts, and real estate development investment fell by 0.1% in January ~ February, compared with a decline of 1% in the whole of last year. From these circumstances, there have been some positive changes. He said.

Specifically, in January ~ February 2023, the national commercial housing sales area was 1 million square meters, down 2.1% year-on-year, and the decline was 5.3 percentage points narrower than that in 6. Among them, residential sales area was 2022 million square meters, down 20.7% year-on-year.

In terms of sales, in January ~ February 2023, the national sales of commercial housing were 1.2 trillion yuan, a year-on-year decrease of 1.5%, a decrease of 0.1 percentage points compared with the whole year of 2022. Among them, residential sales were 26.6 trillion yuan, a year-on-year increase of 1.4%.

Li Yujia, chief researcher of Guangdong Housing Policy Research Center, said that the national commercial housing sales area fell by 1.2% in January ~ February, which was significantly narrower than the same period last year, and market sales are stabilizing and rebounding recently. Commercial housing sales fell 3.6%, and the trend of stopping the decline was also obvious. Reflected in prices, national commodity house prices rose by 0.1% and residential prices rose by 1.2% in January ~ February.

"In February, the trend of stabilization and recovery of the commercial housing market was obvious, and there were three forces for stabilization: rigid demand hindered by the epidemic, demand for house replacement, and demand driven by expected improvement. Reflected in the online signature data, it is expected that the demand repair will continue at least until the first quarter. He said.

Liu Lijie, a market analyst at the Shell Research Institute, said that market repair is driven by many reasons, since last year, various measures such as ensuring the delivery of buildings, protecting people's livelihood, and ensuring stability have effectively protected the rights and interests of home buyers, and the reasonable financing of housing enterprises has also been improved. The good start of improving the liquidity of the real estate market has laid a good foundation for effectively preventing and resolving the risks of high-quality head real estate enterprises this year.

According to data from the China Index Research Institute, the real estate market has improved since the beginning of this year, mainly reflected in the repair of the hot city market, and the national market has not yet stabilized. Since March, the weekly transaction area of new commercial housing in key 3 cities has remained high, with a year-on-year increase of more than 50%; The weekly transaction volume of second-hand houses in key 20 cities continued to increase month-on-month, with a year-on-year increase of more than 10%.

It is worth noting that how long this round of warming up in the property market can last still needs to be observed. A person from a state-owned enterprise in North China told First Finance and Economics that from the company's internal observation, this wave of recovery is mainly due to the release of backlog demand during the epidemic, and long-term sustainability remains to be seen.

Liu Lijie also said that the market recovery in January ~ February is the compensatory release of the backlog of housing demand in the early stage, of which a large number of transactions are improved housing replacement demand, and the short-term transaction volume is relatively high, which does not mean that the market has entered a rapid heating stage. Although the market's forward-looking indicators have recovered, they have not suddenly entered a hot position, and price changes have been relatively stable. The area of new commercial housing for sale across the country is still increasing, and the pressure to dematerialize is still large.

"China's real estate market is still facing a lot of external challenges this year." Liu Lijie said that with the rapid release of this backlog of demand, it is expected that the market repair momentum in March will slow down compared with February, but this does not mean that the market is "stalled", but a normal oscillation in the process of repairing to the trading hub. In the long run, China's urbanization is in a critical stage of transition from demographic dividend to talent dividend, residents have a strong demand for housing conditions improvement and upgrading, and the market can move towards benign and healthy development.

Li Yujia said that in March, the recovery of the second-hand housing market in some hot cities slowed down, some transaction volumes fell, and the number of second-hand housing listings was rising rapidly; The same trend is true for new houses, with visits and subscriptions falling; Except for a few improvement projects in the central area, new and second-hand houses are still mainly price reductions. Whether the follow-up market can continue to stabilize depends on whether the demand side can continue to repair, including policy support for just need to improve, and whether the employment situation can improve.

In addition to sales, real estate completion figures have also seen positive changes. "In January ~ February, the biggest change in real estate in the country is that the completed area achieved a positive growth of 1.2%, which is the first positive growth after 8 consecutive months of decline. It shows that the Baojiao building, which has lasted for more than a year, has made positive progress, especially the completed area of residential buildings increased by 0.11% year-on-year, and the increase was more obvious. Li Yujia said.

However, under the background that the national sales market has not yet stabilized and the financial pressure of enterprises is still large, the downward trend of new housing construction and real estate development investment in the country has not changed, and in January ~ February, the newly started area of housing and real estate development investment decreased by 1.2% and 9.4% year-on-year, respectively, and the decline was significantly narrower than that of the whole year of 5.

China Index Research Institute believes that the financing environment for housing enterprises will continue to improve in the new year, and the financial pressure is expected to be further eased, but the recovery of newly started area still depends on the recovery of the sales market, coupled with the impact of the trend of land shrinkage unchanged and the slow pace of local urban investment projects entering the market, it is expected that the pace of repair of newly started area will still be slow, or further restrict the supply of new housing in some cities; Limited improvement in new construction and cautious investment by housing enterprises will still restrict the repair speed of real estate development investment.