China news finance and economics, April 15 (Zuo Yukun) “in March, house prices in 70 cities decreased month on month, and the number of cities decreased.” On the 15th, the data released by the National Bureau of statistics showed that the sales price of commercial housing decreased month on month, the number of cities decreased, and the year-on-year decline or increase of each line city fell.
Specifically, among the 70 large and medium-sized cities, the prices of new houses and second-hand houses decreased month on month in 38 and 45 cities respectively, 2 and 12 less than last month.
Has the property market really warmed up? What’s the next step?
Data figure: there are many buildings in the urban area. Photographed by China News Agency reporter Wang Dongming
The first tier cities take the lead in stabilizing, and the third and fourth tier cities are under great pressure
According to the data of the National Bureau of statistics, house prices in the first, second and third tier cities showed different trends in March.
New house prices in first tier cities rose 0.3% month on month, down 0.2 percentage points from the previous month. Beijing, Shanghai and Shenzhen rose 0.4%, 0.3% and 0.8% respectively, and Guangzhou fell 0.1%; Second hand housing prices rose 0.4% month on month, down 0.1 percentage points from the previous month. Beijing, Shanghai and Guangzhou rose 1.2%, 0.4% and 0.3% respectively, and Shenzhen fell 0.3%.
According to the big data monitoring of Weifang index, among the first tier cities, the growth rate of Beijing is also relatively higher than that of other cities. In March, house prices rose by 0.23% in Beijing, 0.05% in Shanghai, 0.47% in Shenzhen and 0.56% in Guangzhou.
New house prices in second tier cities were flat month on month, while second-hand house prices fell by 0.1% month on month, 0.2 percentage points lower than last month. The prices of new houses and second-hand houses in third tier cities decreased by 0.2% and 0.3% respectively month on month, 0.1 percentage points lower than that of the previous month.
“After the emergence of the bottom of the policy, the market gradually took the lead in the emergence of the bottom characteristics in the first and second tier cities. In the third and fourth tier cities, the reduction range of house prices was narrowed due to frequent loose policies.” Zhang Dawei, chief analyst of Zhongyuan Real estate, said.
“The year-on-year decline in the third and fourth tier cities is more obvious, and the third and fourth tier market pressure is still relatively large.” Yan Yuejin, research director of the think tank center of E-House Research Institute, pointed out that the relaxation of loan policies and sales restrictions in the future will objectively help to promote the activity of the second-hand housing market.
Data figure: real estate projects under construction. Photographed by Zhang Bin of China News Agency
Loose real estate credit drives market stability
“The core reason for the obvious decline in the property market is the tightening of credit policy, such as the backlog caused by the tightening of house purchase mortgage.” Zhang Dawei pointed out that these problems have begun to ease significantly in recent months, the policy fundamentals have bottomed out, and policies conducive to rigid demand and improving the real needs of home buyers continue to appear.
“Since March, due to the weakening of market demand, banks in more than 100 cities across the country have independently lowered mortgage interest rates according to market changes and their own business conditions, with an average range of 20 to 60 basis points.” On the 14th, Zou LAN, director of the financial market department of the people’s Bank of China, introduced the first quarter financial statistics conference held by the people’s Bank of China.
“In addition, some provincial market interest rate pricing self-discipline mechanisms also cooperate with the regulatory requirements of local governments. According to the actual situation of the city and within the scope of national policies, the lower limit of down payment proportion and interest rate of the city have been lowered.”
Personal housing loans are directly related to real estate transactions. Zou LAN introduced that, for example, the ratio between the amount of individual housing loans issued by new houses and the sales of new commercial houses has always fluctuated between 38% and 42% from a long-term observation. Affected by the recent frequent outbreak of the epidemic, the decline in the income of some residents, the obstruction of real estate construction marketing activities and other factors, the sales of commercial houses fell, and the amount of individual housing loans also fell slightly.
As for the recent concern about whether the mortgage repayment can be delayed due to the epidemic, Liu Zhongrui, head of the statistical information and risk monitoring department of the CBRC, said at a press conference on the 15th that the CBRC will alleviate the repayment pressure of customers affected by the epidemic by flexibly adjusting the mortgage loan repayment arrangement and reasonably delaying the repayment period.
A real estate in Beijing. Photo by Zuo Yukun of Zhongxin finance and Economics
Loose policies or high-frequency introduction
“Since 2020, the real estate market has been impacted by the epidemic and other factors, some real estate enterprises have operational difficulties, house prices have fallen, and cities have increased.” Zou Linhua, head of the housing big data project team of the Institute of financial strategy of the Chinese Academy of Social Sciences, expects that the policies related to real estate will become loose and the market differentiation will further increase.
In the first half of April, local real estate policies continued the easing trend since the first quarter of 2022, and many cities issued real estate easing policies with different efforts. According to the statistics of Zhongyuan Real Estate Research Institute, nearly 20 cities such as Quzhou, Qinhuangdao, Mianyang, Lanzhou, Dalian, Lishui, Suzhou and Nanning issued different real estate easing policies in April.
Throughout the first quarter, the number of various real estate regulation policies was as high as 157, with an average of nearly 2 times a day. 135 times in the same period in 2021, that is, the number of real estate regulation policies in 2022 continues to refresh the historical record in the same period. The policies include Fuzhou, Zhengzhou, Harbin, Qingdao, Guangzhou and other hot cities, mainly to promote rigid demand and improve demand release.
“However, from the perspective of policy effect, due to the superposition of the epidemic, the market is too cold in 2021, the confidence of home buyers has not been restored, and the market activity is still insufficient.” Zhang Dawei said.
Yan Yuejin also believes that April may become a very frequent month of policies, and the introduction of policies can also be understood as several characteristics: high frequency, high density and fast pace. “Of course, the effect release of such policies also needs a process, which is what market participants need to pay attention to.”
At the executive meeting of the State Council held on April 13, it was decided that the central bank would timely use monetary policy tools such as RRR reduction to further strengthen financial support for the real economy, especially industries seriously affected by the epidemic, small, medium-sized and micro enterprises and individual industrial and commercial households, make reasonable profits to the real economy and reduce comprehensive financing costs.
It is generally believed that if the reserve requirements and interest rates are reduced, the real estate market is expected to stabilize faster.
At the same time, the China Index Research Institute pointed out that in addition to the reduction of the standard, the policy of reducing the purchase threshold and purchase cost of home buyers still needs to continue to make efforts to adjust the outdated regulation policies and improve the purchase intention and quality of home buyers