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today's major moves are all aimed at stimulating consumption and stimulating the economy.

1. reduce the deposit reserve ratio by 50 basis points (0.5%) and provide 1 trillion yuan of long-term liquidity. depending on the market liquidity situation, it may be further reduced by 25-50bps in the future.

2. reduce the 7-day reverse repo rate by 20 basis points, and simultaneously reduce the lpr and deposit rates;

3. reduce the interest rates on existing mortgage loans to near the latest issuance level, with an average reduction of 50 basis points.

4. the down payment ratios for the first and second homes are unified, and the down payment ratio for the second home is reduced from 25% to 15%.

……

the above four may be the most direct, critical and important policies, and are also the ones that are most closely related to us ordinary people.

the first two points are obvious, which are to release liquidity to the market and reduce banks' financial borrowing costs.

by reducing the deposit reserve requirement, banks will not have to hand over 1 trillion yuan of funds to the central bank, so that banks will have ample liquidity;

reducing the 7-day reverse repo means that the interest rate on loans lent by the central bank to banks is reduced;

if deposit interest rates are lowered simultaneously, the interest on consumers' savings will also be lowered.

we all know that residents' deposits and money loaned by the central bank to commercial banks are the main sources of bank cash and also the biggest costs for banks.

now the funding pressure on the bank’s cost side has been greatly reduced.

why should we reduce banks’ funding costs?

because the ultimate goal of the central bank's reserve requirement ratio and interest rate cuts this time is to achieve the third and fourth measures: to reduce pressure on the people and stimulate the property market.

the long-rumored interest rate on existing mortgage loans has finally been implemented. the measure is to directly reduce the interest rate on existing mortgage loans to near the latest issuance interest rate level.

this has a huge impact on us ordinary people, especially those who have already bought a house!

for example, in 2020, the interest rate for the first home loan in shenzhen was as high as 4.95%.

the current mortgage rate for first-time home buyers in shenzhen is 3.4%.

if we follow the adjustment idea of ​​existing housing loans, shenzhen’s adjustment will directly reduce it by 155 basis points.

this is simply a big benefits package.

4.95%, the mortgage interest rate for a 3 million yuan house, for 30 years, the monthly repayment is 16,000 yuan.

however, after changing to 3.4%, the monthly payment was 13,000 yuan, a reduction of nearly 3,000 yuan.

over the entire 30 years, the interest paid can be reduced by 970,000 yuan, nearly 1 million yuan.

before downgrade

after downgrade

3,000 yuan, or nearly 1 million yuan in total interest, is a huge financial burden even for first-tier cities.

you say whether the impact is big or not, whether it matters a lot or not.

and it is obvious that the purpose and the biggest beneficiaries of this adjustment of existing housing loans are first-tier cities such as beijing, shanghai, guangzhou and shenzhen.

we all know that the lower limit of the interest rate for existing mortgage loans was adjusted last year, but almost all first-tier cities did not see any adjustment.

this time, governor pan specifically emphasized in the interview that beijing, shanghai, guangzhou and shenzhen are cities with the largest difference in interest rates between existing mortgage loans and newly issued loans.

the president also said that although the banks’ income will be challenged by this adjustment, if no adjustment is made, a large number of unhealthy financial behaviors such as early loan repayments and conversion to operating loans will cause greater harm to the financial system.

it can be seen from this that adjusting existing housing loans is the general trend.

so why do we need to reduce the existing mortgage loans? this is the fourth trick.

reduce the down payment ratio and unify it to 15% for both the first and second homes.

beijing, shanghai, guangzhou and shenzhen are the cities with the strongest consumption power in china.

at the same time, the real estate markets of these four cities are also regarded as the weather vane of the national real estate market.

against the backdrop of the central bank's interest rate cuts in the past few months, the property market in first-tier cities has not been alleviated and is still hovering at a low point.

this shows that ordinary people are not unwilling to buy houses now, but they dare not buy houses because their income or expected income will decrease.

only when their expenditure costs are truly reduced will ordinary people be willing to buy houses.

people who own houses in these cities are wealthy people with stronger purchasing power than others.

reducing their burden, lowering the interest on existing mortgages, and reducing the down payment ratio are also aimed at stimulating these wealthy owners of existing mortgages to consume.

in the context of the second-child policy, improving housing is also a basic need.

therefore, in my opinion, the core of these four major measures is to stimulate the property market.

china's economic downturn is largely due to the sluggish real estate market.

as a pillar industry of china's economy, real estate and related industries, which once contributed 30% of gdp, will definitely not be a unilateral matter of the real estate industry if they collapse.

i believe that all of us have felt deeply this year.

the real estate industry will not die out. it just needs more time to transform into a new real estate model, exchanging time for space and truly achieving a soft landing.

today's policies are very powerful, because the people have really benefited from them, and i want to applaud!