With the release of new home transaction volume in January 2021, the transaction volume of new homes in many cities across the country hit a low in January. For example, the Zhengzhou real estate market sold 5,458 units in January, setting a historical lowest in Zhengzhou's new home transaction volume in the past 10 years. Compared with the sluggish transaction volume, housing prices in major northern cities have seen collective declines in housing prices. Even the national housing prices rose a lot in January. Of course, the increasingly stable housing prices are very good news for home buyers who don’t have a house yet. Judging from the regulatory policies in the past two months of 2021, the country's regulation of the real estate industry is getting stronger and stronger, and there is no sign of relaxation.
Since the country started regulation of the real estate industry in September 2016, the rising housing prices in most northern cities have gradually slowed down, and then a pullback has gradually begun. Especially in most cities in the north, housing prices basically saw a pullback of different amplitudes in 2020. For example, housing prices in major northern cities such as Beijing, Tianjin, Shijiazhuang, Qingdao, Zhengzhou, and Harbin have all declined to varying degrees. In addition to these northern cities, housing prices in other northern cities have also fallen to varying degrees. For example, cities around Beijing, such as Yanjiao , Zhuozhou , Xianghe , Dachang and other cities, basically fell by more than 50%; for example, small and medium-sized cities in other northern provinces, such as Nanyang, Weifang, Zhoukou, Chengde , Zhangjiakou , Luoyang and other cities, are showing a downward trend.
It can be said that in 2020, among the medium and large cities in the north, housing prices in other cities were basically "fallen" in total, except for Xi'an and Tangshan. Compared with southern cities where housing prices are still rising, why do housing prices in northern cities collectively "lost"? According to the current housing market environment, there are three reasons:
The first reason: housing prices are seriously high, and the economy, population and industry cannot support such high housing prices
Although housing prices in northern cities are not as high as those in southern cities, from the perspective of residents' income level, housing prices in northern cities are still seriously high. For example, the housing price-to-income ratio in Beijing has exceeded 30, and Beijing's population has declined in recent years due to population divergence plans; for example, the Beijing-Ambiental surrounding area with the largest decline in housing prices, preferably house prices here are as high as more than 20,000 to more than 40,000, and such high housing prices in these areas are not supported by the economy, population and industry. After these cities began to purchase restrictions, a large number of investors were lost. The remaining local residents not only had less demand for housing purchases, but also insufficient purchasing power, so it is normal for housing prices in these cities to fall.
In addition, for other small and medium-sized cities, especially some small cities with underdeveloped economies, local residents have low income levels, but housing prices are very high. For example, the author’s hometown is a small northern county town. In the past few years, it was still a poor county. Even such a county town has already reached 7,000 to 8,000 yuan, and the housing prices of some good real estate projects have exceeded 10,000 yuan. It is obvious that housing prices in cities like this are already seriously high, while the population of these small and medium-sized cities is constantly losing. With the decrease in population, housing prices in these cities naturally cannot continue to support the continued rise in housing prices. Therefore, for these cities, it is normal for house prices to fall here.
The second reason: the property market regulation policies are constantly being regulated, investors exit the property market
The decline in housing prices in northern cities began with the state's regulation of the real estate industry, especially the housing prices in Beijing and cities around Beijing. After the regulation policy was introduced, a pullback quickly occurred. It can be said that in the last round of housing prices, real estate speculators played a very important role in it. After the regulatory policy was introduced, the local real estate market lost real estate speculators, and after losing a large number of investors, the house was immediately difficult to sell.
So far, the country's regulatory policies for the real estate industry are still tightening. In the first two months of 2021 alone, 62 regulatory policies have been issued across the country.In addition, from February 1 to 10, that is, in the 10 days before the Spring Festival, provinces and cities such as Beijing, Shenzhen, Hangzhou, Jiangxi and Shanghai have introduced targeted policies to crack down on real estate speculation. Therefore, under the continuous regulation of regulatory policies, housing prices in northern cities are likely to continue to fall in 2021.
The third reason: oversupply of housing resources, and the supply and demand relationship has changed
Houses are for people to live in, but at present, our country's housing resources are already seriously oversupply, especially for small and medium-sized northern cities with continuous population loss, the housing price trend here is very stressful. According to the data from the National Bureau of Statistics , the per capita housing area of urban residents in our country has exceeded 39 square meters, and there are continuous new commercial housing constructions that continue to enter the market, so the problem of oversupply of housing resources will exist for a long time in the future. In addition, population mobility is also changing. In the past, population mobility has been flowing from rural areas to cities, but at present, population mobility has changed from small cities to large cities, which means that urbanization construction can no longer support the continued rise in housing prices.
On the one hand, the population cannot increase as rapidly as in the past, and even the population in some cities is still losing. On the other hand, housing resources are increasing and oversupply. Therefore, like the north where the economy is not as strong as the south, the housing prices here are indeed not as strong as those in southern cities.
Finally, in the long run, with the continuous influx of population and the development of the economy, there is still room for housing prices in these big cities in the north to continue to rise in the future. However, in the short term, housing prices in not only northern cities, but also southern cities with more economically developed economy have also been seriously inflated, deviating from the income level of local residents. Just as Ren Zeping, chief economist of Evergrande, said, the housing price trend is in the short term, the land in the medium term, and the population in the long term. At present, the urbanization rate in our country has exceeded 60.6%. Although urbanization continues, the slower the urbanization construction will be. Therefore, in the future, the population of rural areas to cities will become smaller and smaller. In addition, according to data from the National Bureau of Statistics, and 100 people born in 00 are 103 million less than those born in 80s and 90s, and the new population in our country is still setting a new low. Currently, the post-80s and post-90s are still the main force in home purchases, but as time goes by, the post-00s and post-10s will also enter the age of buying houses, which also means that the number of young people who have a demand for houses is gradually decreasing.
Houses are for people to live in. The new population of our country has reached lows every year, but housing prices have reached highs every year, and housing resources are also increasing. With so many houses built and so high housing prices, who should we sell so many houses to in the future? Who will let these houses live in? It can be predicted that in a few years, our country's population will experience negative growth, and by then, more and more houses will be vacant and uninhabited. As Wu Xiaoling, former vice president of the Central Bank, warned:
There are not many days to roam in the bubble, and preparing for the tide after it recedes is a reality that every country and everyone must face.
