Beijing, 9 Sep (ZXS) -- First-tier cities are expected to get out of the downward range

China News Agency reporter Pang Wuji

On September 9, Shanghai and Beijing announced the implementation of the policy of "recognizing housing without loans". Its policy text is basically the same as that of Guangzhou and Shenzhen, and it is not implemented only in different regions as some industry insiders speculated, which exceeds market expectations. So far, the policy of "recognizing housing without loans" to support the improvement demand has been fully implemented in four first-tier cities in China.

A number of experts believe that first-tier cities, as the "wind vane" of the property market, their housing finance credit policies have been substantially relaxed, releasing strong policy signals, which is expected to greatly repair market sentiment and expectations, boost market confidence, and the real estate market in core cities is expected to come out of the downward range.

Why is Beijing and Shanghai following up at the same time?

Guangzhou and Shenzhen among the first-tier cities took the lead in "recognizing housing but not recognizing loans", which may be related to the downward pressure on their markets being greater than that of Beijing and Shanghai. In July, prices of new commercial homes in Beijing and Shanghai rose 7.0% and 4.0% month-on-month, respectively, while Guangzhou and Shenzhen fell 2.0% and 2.0% month-on-month, respectively, official data showed.

However, from the recent market volume, the Beijing and Shanghai property markets are also facing certain downward pressure. According to data from the China Index Research Institute, in August, the transaction area of new houses in Beijing fell by 8.22% month-on-month and 3.17% year-on-year, and 8,10960 sets of second-hand houses were transacted, down 20.2% year-on-year. The transaction volume of new commercial housing in Shanghai has been below 5000,4 units for two consecutive months, while the transaction volume of second-hand housing has been below the "boom and bust line" for four consecutive months.

Li Yujia, chief researcher of the Housing Policy Research Center of Guangdong Urban Planning Institute, believes that the downward trend of the property market in August exceeded market expectations, and the transaction volume of first-tier cities that was relatively strong in the past fell first, so it is urgent to stabilize expectations as soon as possible when the "golden nine silver ten" and the peak sales season at the end of the year comes. In particular, the property market in the three metropolitan areas, including Beijing, Shanghai, Guangzhou and Shenzhen, accounts for 8% of the sales share of the national new housing market, which is the basic market of the real estate market and the starting point for stabilizing the property market. This is also an important reason why Shanghai and Beijing have also followed up this time to "recognize housing but not to recognize loans", and the policy expression is consistent with Guangshen and Shenzhen.

Zou Linhua, head of the housing big data project team of the Institute of Financial Strategy of the Chinese Academy of Social Sciences, also said that since the second quarter, although the property market in first-tier cities has also experienced a phased downturn, sales have shrunk and house prices have fallen, but overall, the property market in first-tier cities is relatively healthy, and the phenomenon of housing surplus is not prominent. However, he stressed that from a macro perspective, in order to reverse the common decline and its underlying systemic risks, it is necessary to adopt a certain "one-size-fits-all" approach to boost market confidence. He believes that it is necessary for first-tier cities to fully implement "housing without loans" and other demand support means.

The property market is expected to come out of the downward range

A number of recent policies are expected to form a synergy to promote the expected recovery of the property market. On August 8, the People's Bank of China and other two departments issued a document saying that the minimum down payment ratio policy for commercial personal housing loans for first and second homes will be unified to no less than 31% and 20%; Adjust the lower limit of the interest rate policy for the second housing to not lower than the corresponding term loan market quotation rate (LPR) plus 30 basis points.

According to the analysis of Shell Research Institute, the 20% and 30% down payment reached the lowest down payment level in the history of Chinese real estate. In particular, the down payment ratio in large cities has significant room for decline, the threshold for buying a house will be reduced, and the purchasing power will be greatly improved. Buyers who were originally waiting and waiting because of down payment restrictions or unclear policies will concentrate on the market, the growth of market transaction volume will drive the price expectation to improve, house prices will gradually stabilize, and the market is expected to come out of the downward range and resume benign and healthy development.

How strong are the policies stacked? Chen Wenjing, director of market research at the China Index Research Institute, pointed out that for families who buy houses without a house and a loan record in Beijing, the down payment ratio will be reduced from 60%-80% to 35%-40%, and the down payment ratio of ordinary houses will be reduced by 400 million yuan and the down payment of non-ordinary houses will be reduced by 100.160 million yuan. Mortgage rates will be reduced by 5 basis points from 25.4% to 75.50%. Taking a 300 million yuan loan as an example, the interest will be reduced by 25,26 yuan based on equal principal and interest for 21 years, and the purchase threshold and purchase cost will be significantly reduced.

Shell Research Institute pointed out that according to historical experience, the transaction level of second-hand houses in the three months after the relaxation of loan restrictions increased by 20%-30% compared with before the policy. This time, two days (8-30) after the implementation of the "house recognition but not loan" policy in Guangzhou and Shenzhen on August 30, the average daily transaction volume of second-hand houses in Guangzhou increased by 31% compared with last week's level, and Shenzhen increased by 25%, and the number of customer viewing also increased rapidly.

According to the monitoring of the Middle Index, in addition to first-tier cities, Wuhan, Zhongshan, Huizhou, Dongguan and other cities have clearly issued documents to implement the first set of housing "house recognition but not loan", and other second-tier and third- and fourth-tier cities will follow up in the short term. Policy warm wind blows frequently, the real estate market in core cities will usher in a wave of upward market, and the "golden nine silver ten" market can be expected. (End)