With the gradual emergence of policy effects, the data of the real estate market in May reversed the downward trend and the market margin was repaired. Many institutions believe that there is still room for adjustment in all aspects of policies, and it is expected that they will continue to exert their efforts and adopt more targeted measures in the second half of the year.
High-frequency policy adjustment supports reasonable housing demand
On April 29th, the the Political Bureau of the Communist Party of China (CPC) Central Committee meeting proposed to support local governments to improve real estate policies according to local conditions, support rigid and improved housing demand, optimize the supervision of pre-sale funds of commercial housing, and promote the stable and healthy development of the real estate market. Subsequently, the frequency and intensity of local policies were accelerated. According to the statistics of the Central Reference Institute, in the first half of the year, over 180 provinces and cities nationwide issued nearly 500 real estate control policies.
From the perspective of policy types, all localities continue to focus on improving real estate policies from the demand side. The central level has repeatedly emphasized supporting reasonable housing consumption, and lowered the threshold for buying houses by adjusting the policy of restricting purchases and loans, releasing more demand for buying houses to enter the market.
According to the statistics of Kerry Research Center, in the first half of the year, 36 cities relaxed their purchase restrictions and 54 cities relaxed their loan restrictions. Take Zhengzhou as an example. In March, Zhengzhou introduced 19 measures to stabilize the property market, taking the lead in canceling "recognizing housing and accepting loans" and stipulating that the elderly can buy new houses if they rely on their families. The industry believes that this regulation actually cancels the purchase restriction; In June, Zhengzhou Airport Area further increased its relaxation efforts, announcing that the minimum down payment ratio for the first suite was 20%, and the minimum down payment ratio for the second suite outstanding loans was 30%.
According to Han Yizhiku's analysis, the purpose of the current loan restriction policy adjustment is to ensure the release of residents' reasonable housing demand and improve consumers' ability to pay, which undoubtedly releases a good signal to some consumers who have housing demand but cannot release it due to policy factors.
At the same time, some core cities such as Shanghai, Hangzhou and Hefei have relaxed the threshold for settlement. Among them, Shanghai stipulates that graduates from research institutes and universities in Shanghai, graduates from world-class universities and graduates from world-class disciplines can settle down directly without "scoring". According to the research report of CITIC Construction Investment, this will continue to support the marginal repair of the sales market; Han Yizhiku believes that the main goal of relaxing the threshold for talent settlement in core cities is to attract talents, which will also increase the market purchase base in the short term.
The interest rate of the first home loan in the same city was lowered to 4.25%, and the room ticket system was restarted.
Relieving the pressure on consumers to buy houses is also one of the main directions of the property market regulation policy in the first half of the year.
In May, the central bank announced that the lower limit of the first home loan interest rate would be lowered by 20 basis points. A few days later, it was announced that the LPR had been lowered by 15 basis points for more than five years, which was the largest single decline in history. Many cities have stepped up efforts to implement preferential policies for mortgage interest rates. According to the statistics of Kerui Research Center, at present, 58 cities including Suzhou, Zhengzhou, Jinan, Nanjing and Wenzhou have implemented the first home loan interest rate of 4.25% and the second home loan interest rate of 5.05%.
There are also many cities that have adjusted the policies related to provident fund. In June, Fujian province announced that the down payment ratio of employees' families applying for provident fund loans for the second time to buy a house was reduced to 30%; For families who have two or three children in line with the national birth policy, the maximum loan amount of housing provident fund will be appropriately increased. Zhejiang province has increased its support for housing provident fund for three-child families, including increasing the loan amount, withdrawing the loan amount and giving priority to loans. Hangzhou, Shaanxi and other places all stipulate that depositors who are unable to repay housing provident fund loans normally due to the COVID-19 epidemic can apply for no overdue.
Room tickets also reappeared in the first half of the year. According to Han Yizhiku's statistics, by the end of June 2022, Zhengzhou, Lishui, Shaoxing, Haining, Ezhou and other 19 cities had introduced the "room ticket" system. Among them, Zhengzhou stipulates that if the expropriated person chooses the house ticket for resettlement, he can get 8% of the resettlement compensation rights and interests, and at the same time reward the expropriated person with a three-month transition fee in cash. "By encouraging the resettlement of housing tickets for resettlement groups, the government can play the role of supporting the market, which is conducive to the market destocking and boosting the confidence of the overall real estate market." Liang, general manager of Henan Branch of the Central Finger Hospital, said.
In addition, some cities have taken measures such as granting subsidies for house purchase, adjusting sales restrictions and reducing real estate taxes and fees to support the release of rigid and improved demand. From the supply side, they have taken measures such as adjusting local auction rules and pre-sale fund supervision policies to promote the healthy development and virtuous circle of the real estate market.
The policy has shown initial results and is expected to continue to be adjusted in the second half of the year.
With the continuous introduction of local policies and the gradual weakening of the epidemic, the real estate market tends to be stable. According to the data of the Central Reference Institute, the year-on-year decline in the sales area and sales volume of commercial housing nationwide in May narrowed by 7.2 and 8.9 percentage points respectively compared with April, and the market margin was repaired. The year-on-year decline in the transaction area of key 100 cities continued to narrow, rising in May and continuing to grow in June.
However, the policy effect still needs to be further strengthened. Kerui Research Center believes that after the meeting of the Political Bureau on April 29th, the frequency and intensity of local relaxation policies have increased, but the actual effect is still lacking. The core reason lies in the ineffective policies and the lack of systematic policies.
Regarding the trend of industrial policy in the second half of the year, Kerry Research Center believes that the real stabilization of the market still needs the help of policy combination boxing. Second-tier and third-and fourth-tier cities may completely cancel the restrictions on purchases, sales and prices, and housing enterprises are expected to implement the necessary rescue policies and measures.
Many institutions also predict that policies will continue to be optimized and adjusted in the second half of the year. Zhongyiyuan said that at present, the regulatory policies of some cities are still relatively restrained, and the policy strength is expected to be further strengthened in the case of continuous decline in market sales. In the short term, the frequency of local policies will be maintained at a relatively fast speed, and there is still room for policies at both ends of supply and demand.
Zhuge Housing Search Data Research Center believes that although this round of policies covers a wide range of cities and the frequency of regulation is more frequent, from the perspective of strength, they are all slightly loose on the basis of previous strict control, and the policy threshold is still in a relatively strict stage. At present, residents' demand for housing quality has increased, and the demand for improvement has increased. However, the threshold for buying houses above the second suite is still at a high level. The agency expects that there is still room for relaxation in related policies in the future.