China News Service, January 30 (China News reporter Zuo Yukun) Recently, the Ministry of Housing and Urban-Rural Development held a deployment meeting for the urban real estate financing coordination mechanism. This important meeting at the beginning of the year is considered to be the authoritative weather vane for understanding the current real estate financing situation and the next step of real estate work deployment.
The virtuous cycle of real estate depends on moderate supply and reasonable demand. Some analysts pointed out that the prominent problem currently faced by my country's real estate market is the contradiction between the structural "destruction" on the supply side and the structural "gap" on the demand side. It is not difficult to find that the current series of statements from relevant departments are aimed at improving demand-side expectations and ensuring supply-side security.
After the announcement, cities have taken the lead in responding. The industry expects that the supply and demand policies will continue to increase in the future, which is worth looking forward to.
Data map: real estate properties. Photo by China News Service reporter Zhang Bin
Financing support further targeted to “projects”
The performance of the real estate demand side is not only related to the sales collection, cash flow status and risk resolution of real estate companies, but also related to the stable and healthy development of the real estate market.
The Ministry of Housing and Urban-Rural Development stated that it will accelerate the implementation of the urban real estate financing coordination mechanism, support the development and construction of real estate projects, meet the reasonable financing needs of real estate companies of different ownerships without discrimination, and promote the stable and healthy development of the real estate market.
Since it was first proposed at the Central Financial Work Conference at the end of October 2023, "equal treatment to meet the reasonable financing needs of real estate companies of different ownerships" has become an important criterion for financing support for real estate companies. The focus of the Ministry of Housing and Urban-Rural Development’s statement is to refine the target of support from “enterprises” to “projects”.
Specifically, the Ministry of Housing and Urban-Rural Development emphasized that in response to the current financing difficulties for some real estate projects, all localities should take projects as the target, promptly study and propose a list of real estate projects that can provide financing support, coordinate the issuance of loans by financial institutions within their respective administrative regions, and accurately and effectively support reasonable financing. need.
A stable supply side is the basis for improving consumer expectations. Yan Yuejin, research director of E-House Research Institute, reviewed the financing policies in recent years and pointed out that they have gone through the first three stages of "protecting the legitimate rights and interests of housing consumers", "16 financial articles" and "three no less than", and are currently entering into A new stage of “Financing Coordination Mechanism”.
"This subtle change also shows that some past financing support policies or problems with reduced efficiency cannot directly reach the project end." Yan Yuejin said that the policy has made new arrangements based on the new situation, and through the coordination role of the municipal government, it has promoted the real estate market situation. Changes and financing policies promote better integration.
The “white list” of real estate projects is about to be released
"Currently, different departments are focusing on the implementation of the urban real estate financing coordination mechanism, aiming to promote the implementation of specific projects, explore a mature mechanism for financing coordination, solve the problem of distrust between banks and real estate companies, and force real estate companies to strengthen business management and implement Support for stable enterprises." Li Yujia, chief researcher of the Housing Policy Research Center of the Guangdong Provincial Institute of Urban and Rural Planning, believes.
Data released by the China Index Research Institute shows that although there will be marginal improvements in financing policies for real estate companies in 2023, the scale of non-bank financing will continue to decline. The industry achieved a total of 722.27 billion yuan in non-bank financing throughout the year, a year-on-year decrease of 15.1%.
This also calls for follow-up and increased implementation efforts after the mechanism is established. In this regard, the Ministry of Housing and Urban-Rural Development stated that the first batch of project lists will be launched before the end of this month, and loans can be obtained after landing.
On the same day as the Ministry of Housing and Urban-Rural Development, the State Financial Supervision and Administration Bureau also held a meeting to deploy work related to the implementation of the urban real estate financing coordination mechanism. It is mentioned that in accordance with the principle of fairness and justice, a list of real estate projects that can be provided with financing support must be screened and forwarded to financial institutions within the administrative region.
"Accurate support for real estate project financing will help stabilize the real estate industry." Liu Shui, corporate research director of the China Index Research Institute, believes that on the one hand, speeding up the approval process for high-quality real estate projects and forming physical investment as soon as possible will help stabilize real estate investment; on the other hand, On the one hand, financing support for projects that have temporarily encountered difficulties will help reduce project delivery risks, improve industry expectations, promote the release of real estate demand, and help stabilize the real estate market.
Data map: Guangzhou. Photo by Wang Jian
Local governments gain greater autonomy in regulation
As soon as the words of the Ministry of Housing and Urban-Rural Development and the State Financial Supervision and Administration Bureau came into effect, key cities immediately followed up and opened the "tool box" again.
On January 27, Guangzhou issued a document stating that it would establish a real estate financing coordination mechanism, build a government-bank-enterprise communication platform, and promote accurate docking between real estate development companies and financial institutions. Guangzhou has thus become the first city to implement a real estate financing coordination mechanism.
What has formed a synergy with this and attracted greater attention is Guangzhou’s adjustment to the purchase restriction policy: within the purchase restriction area, the purchase of housing with a construction area of more than 120 square meters (not including 120 square meters) is not included in the scope of the purchase restriction.
Why was the scope set to 120 square meters? This is in line with the trend of increasing demand for improvement in the Guangzhou property market in recent years.
According to CRIC statistics, the proportion of first-hand and second-hand residential transactions of more than 120 square meters in Guangzhou in 2023 will increase by 3.8 percentage points and 5 percentage points respectively compared with 2021. Specifically, in areas where purchase restrictions are still enforced, the supply and demand of first-hand housing above 120 square meters accounts for a larger proportion. In 2023, a total of 10,456 units will be supplied, accounting for 42% of the purchase-restricted areas; 8,409 units were sold, accounting for 37% of the purchase-restricted areas.
“As the first first-tier city to implement optimized real estate policies after the Ministry of Housing and Urban-Rural Development meeting, Guangzhou also provides a reference for other cities to adjust their policy directions. It is expected that more cities will introduce regulation and optimization policies based on their own actual conditions in the future to promote a stable, healthy and stable real estate market. Sustainable development." Yang Hongxia, general manager of the South China Branch of the China Index Research Institute, believes.
At the same time, Guangzhou’s introduction of precise policies based on local actual conditions should also be in line with the Ministry of Housing and Urban-Rural Development’s policy direction of further “delegating power” to local control.
The Ministry of Housing and Urban-Rural Development stated at the above-mentioned meeting that it is necessary to adhere to city-specific policies, precise policies, and one policy for one city, make good use of the policy toolbox, and fully give cities autonomy in real estate regulation, so that each city can adjust real estate policies according to local conditions.
Regarding real estate regulation, Ni Hong, Minister of Housing and Urban-Rural Development, once used the analogy of "nine of ten pots are different." The latest setting of this year’s urban control policy direction is also considered to send a strong signal to implement the responsibilities of local entities.
"It is expected that the policy will continue to be loose in 2024, and the policy toolbox will be further explored from two dimensions: depth and breadth. There is still the possibility of a reduction in mortgage interest rates and down payment ratios this year, and various regions will make optimization adjustments to varying degrees based on their own conditions. Guan Rongxue, senior analyst at Zhuge Data Research Center, believes. (over)