In the past, there was no commercial housing in mainland China, and there was no so-called real estate development model;
Later, the paid auction and use system of land, the pre-sale system of commercial housing off-plan, and the shared area were introduced from Hong Kong, and the provident fund system was introduced from Singapore. On this basis, my country's real estate development model has been formed.
Last year, the Central Economic Work Conference proposed "exploring new development models" for the first time.
This year, the Central Economic Work Conference further proposed "promoting the smooth transition of the real estate industry to a new development model."
2021 is the year when the old model of the real estate industry comes to an end, and it is also the year when the old model moves towards a new development model.
It is in 2021 that the property market has encountered an extreme reversal of ice and fire -
In the first half of the year, it was not too long before the three red lines, and the popularity of local auctions was still very high; in the second half of the year, Private enterprises have basically disappeared from the land market. State-owned enterprises and local urban investment platforms have ended up acquiring land, but the pace of land supply has continued;
In the first half of the year, market transaction volume and price were still at a high level; in the second half of the year, transaction volume shrank significantly, and price declines forced more than 20 cities to issue price limit orders.
It is in 2021 that real estate companies have encountered a liquidity crisis -
From the second half of last year to the fourth quarter of this year, more than 30 real estate companies have defaulted on their debts, especially one large company with a debt of 2 trillion, which shocked the country.
It is in 2021 that the problem of suspended construction and uncompleted projects has become more and more serious -
According to CRIC statistics, at the end of 2021, there were as many as 180,000 houses involved in suspended projects in 24 key cities, let alone the whole country.
By this year, the problem of work stoppages and unfinished projects has exploded across the country, and has even developed to the point of dynamic loan repayment. As a result, the Baojiao Building has risen to the height of the central level.
All these together illustrate a problem-
The old model of the real estate industry can no longer be maintained.
Local governments are extremely dependent on land finance. Umbrella sellers definitely don’t want the rain to stop, and land sellers naturally hope to sell the land at a good price;
Commercial housing dominates the market, while the development of affordable housing and rental housing lags far behind, and no one can avoid high housing prices;
The three-high development and operation model of "high debt, high leverage, and high turnover" of real estate companies has left huge hidden dangers to society and the self-occupied groups who just need to improve.
At the central level, a new development model for real estate has become imperative.
Comparing the two Central Economic Work Conferences, the statement of the real estate section in 2021 was placed on "structural policies must focus on smoothing the national economic cycle", and in 2022 it was placed on "effectively preventing and resolving major economic financial risks ";
The wording of the new development model has changed from "exploration" to "smooth transition";
In a word, it is inevitable to destroy the old and establish the new in the real estate development model, but it cannot be rushed.
What should the new real estate development model look like?
Let’s take a look at the government’s definition of the new real estate model:
Accelerate the establishment of a housing system with multi-subject supply, multi-channel guarantees, and both renting and purchasing;
Insist on both renting and purchasing, accelerate the development of the long-term rental housing market, promote the construction of affordable housing, and support the commercial housing market to better meet reasonable housing needs.
These words come from either the Party Congress report or the Central Economic Work Conference. The level of specifications has reached the top, which is basically the final word.
The simultaneous promotion of renting and purchasing was proposed in 2015 and launched as a pilot in 2017. It also simultaneously guarantees the equal rights of renting and purchasing. However, the equal rights of renting and purchasing involves a series of policies and systems such as school districts, settlements, provident funds, and public welfare, and there is still a long way to go before they are truly implemented.
Since the price increase in 2016 destocking to the first half of 2021, the overall housing prices have been rising. Under the pressure of high housing prices, mothers-in-law don’t believe this. A house, a car and a deposit are the minimum standards. How many mothers-in-law would trust a son-in-law who rents a house for a long time? ?
Although the country is vigorously increasing the proportion of affordable housing supply, it is impossible for affordable housing to replace the market position of commercial housing and its cognitive status in the public psychology in the short term.
These are only in the field of housing supply.
A complete new real estate development model obviously should not stop in the field of housing supply.
Regarding the new model of real estate, real estate must be viewed in the context of the overall economic development, and real estate cannot be discussed in terms of real estate.
In terms of land supply, improve the land transfer policy that links people to land , reduce the mismatch of land supply, and gradually eliminate over-reliance on land finance; control land prices, stabilize land prices, and appropriately adjust land prices.
In terms of housing supply, continue to implement both renting and purchasing, increase the supply scale of affordable housing and rental housing , improve the quality of living, and improve supporting supporting policies and measures;
In terms of development model, guide real estate companies to improve their operational capabilities bid farewell to the past development model and improve product quality.
On the financing of real estate companies, broadens the financing channels of real estate companies, develops a variety of financing models, reduces dependence on bank loans, and reduces financial risks.
On the Guojiao Tower, the pre-sale system for commercial housing off-plan will be gradually cancelled, or mortgage repayments will be started after the house is delivered and certified, , to reduce social risks.
In terms of taxes and fees on development transactions, the government as a whole has reduced taxes and fees on real estate development and transaction links to reduce costs and benefit the people.
Why do we do this?
The fundamental reason is to understand a problem-
What problem should the new real estate development model solve?
As an economic pillar, it provides support for economic growth. Everyone knows this;
systematically plans the institutional construction of the real estate industry to make it more Healthy and stable;
provides a more reasonable economic environment and talent living environment for industrial transformation and upgrading;
Ultimately, it is to eliminate the bubble that has gradually accumulated since the price increase and destocking, and achieve a soft landing.
There is no doubt that the transformation of the real estate industry from the old model to the new development model is a long-term process and cannot be achieved overnight.
However,
In the short term, the real estate industry must be saved.
Any policy is the product of a balanced choice between long-term goals and short-term goals.
A sentence came out from the mouth of a senior leader a few days ago, and then swept the entire real estate industry, as sweet as eating honey -
"Real estate is a pillar industry of the national economy...New measures are being considered...to guide market expectations and confidence to recover...there is enough demand space to provide support for the stable development of the real estate industry."
Within a few days, the Central Finance Office explained to everyone what the pillar status of real estate is:
The real estate chain is long and covers a wide range of areas, accounting for GDP It is about 7%, and the construction industry accounts for 14%;
Land transfer income and real estate-related taxes account for nearly half of local comprehensive financial resources and 60% of urban household assets. Real estate loans plus loans with real estate as collateral account for 39% of all loan balances.
Moreover, the Central Finance Office also explained the potential of housing demand and proposed solutions:
There is still a lot of room for improvement in my country's urbanization rate, and the demand for rigid and improved housing is huge.
Continue to optimize demand-side management and increase financial support for rigid and improved housing needs.
words have laid the groundwork to this extent.
can imagine what action he will take next, even with his eyes closed:
- Optimize some restrictive policies in the field of housing consumption that hinder the release of consumer demand
To put it more plainly:
- Save the property market! A new round of rescue for the property market!
Let’s take a look at the recent actions of to rescue the market in first- and second-tier cities:
December 5, Xiamen , non-registered residents who actually work and live in Xiamen are limited to purchasing one house outside the island;
On December 10, Foshan , Shunde Daliang, Chancheng Ancestral Temple, Nanhai Gui City suspends housing purchase restrictions;
html On December 21, Nanjing, non-locals only need to provide proof of residence for more than six months to buy a house;
On December 26, Dongguan , purchase restrictions were lifted in Dongguan;
On December 28, Suzhou , the down payment for the second unpaid loan was changed from 60% to 40%.
…………
These actions to strengthen the second-tier cities are just the beginning of a new round of saving the property market.
The property market cannot afford it, and the bailouts are endless.
Saving the property market at this stage is inevitable and necessary.
I recently liked the words of Professor Zhai Dongsheng -
The market is not a self-contained existence. The market itself is a public product provided by the government.
In the long run, are the new real estate development model and related systems not public goods created by the government?
As a policy city, how strong the real estate market rescue next year will be does not entirely depend on the real estate industry itself.
If the economy recovers relatively smoothly after experiencing the impact of liberalization, it will be necessary to continue to relax policies such as purchase restrictions and loan restrictions and continue to moderate stimulus;
If the pressure to stabilize growth under repeated shocks is too great and cannot be sustained by the middle of the year or the third quarter, it is likely to require strong stimulus, and it may not be impossible for first- and second-tier cities to start monetizing shanty towns.
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