with all real estate policies basically implemented, how long will it take for the market to stop falling and rebound?
2024-09-30
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(the author of this article is ma guangyuan, deputy director of the central economic committee of the democratic national construction association)
on september 27, the political bureau meeting of the cpc central committee set the tone for real estate policy:to promote the real estate market to stop falling and stabilize, we must strictly control the increment of commercial housing construction, optimize the stock, improve the quality, increase the loan supply for "white list" projects, and support the revitalization of existing idle land. it is necessary to respond to the concerns of the masses, adjust the housing purchase restriction policy, reduce the interest rate of existing mortgage loans, speed up the improvement of land, fiscal and taxation, banking and other policies, and promote the construction of a new model of real estate development.
this is by far the clearest and most anticipated policy adjustment in this round of real estate policy.
considering the unusual nature of this politburo meeting, we expect that the policy will be implemented before the long holiday. really:
on september 29, the central bank, the state administration of financial supervision and others issued announcements involving specific adjustments to existing mortgage interest rates, unification of down payment ratios for first and second homes, and other financial policies involving real estate.
in particular, everyone is concerned about the specific adjustment methods and time for existing mortgage interest rates. the central bank gave a clear answer:
first, existing mortgage loans that meet certain conditions are allowed to renegotiate the point increase range to promote the reduction of existing mortgage interest rates.the central bank guides the market interest rate pricing self-regulatory mechanism to issue the "initiative on batch adjustments to existing mortgage interest rates", which stipulates that in principle, all commercial banks should uniformly implement batch adjustments to the interest rates of existing housing loans (including first, second and above) before october 31, 2024. .
after the batch adjustment, the borrower's existing mortgage interest rate will in principle be reduced to no less than the loan market quoted rate (lpr) minus 30 basis points, that is, "lpr-30 basis points", making the interest rate level close to the national new mortgage interest rate. it is expected that the average decrease is about 0.5 percentage points;
second, establish a normal adjustment mechanism: starting from november 1, 2024, when the interest rate of floating-rate commercial personal housing loans deviates from that of newly issued commercial personal housing loans nationwide to a certain extent, the borrower can negotiate with banking financial institutions. banking financial institutions will issue new commercial personal housing loans with floating interest rates to replace existing loans.the re-agreed point increase range should reflect changes in market supply and demand, borrower risk premium and other factors, and the point increase range should not be lower than the lower limit of the interest rate increase point for commercial personal housing loans in the city where the loan was replaced.
here, i would like to make a special note that regarding existing mortgage interest rates, i have always advocated the establishment of a normal adjustment mechanism to stabilize market expectations.the biggest highlight of the central bank's adjustment of existing mortgage interest rates this time is the establishment of a normalized adjustment mechanism.
according to the central bank: in august 2023, in order to fully respond to the demands of the masses and based on the principle of urgency, the central bank, together with the state administration of financial supervision, guided commercial banks to adjust existing mortgage interest rates in batches by negotiating changes to contract interest rates and other methods, and achieved good results. . however, because the point increase rate cannot be adjusted independently under the current mortgage interest rate pricing mechanism, the contradiction between the interest rates of new and old mortgages has once again accumulated and expanded recently. commercial banks will coordinate through industry self-discipline to carry out another batch adjustment of eligible existing housing loans, lowering the interest rate to around the national new housing loan interest rate.
however, the above-mentioned methods treat the symptoms rather than the root cause. to fundamentally solve the problem of interest rate differentials between new and old mortgages, we need to deepen the market-oriented reform of interest rates, while maintaining the seriousness of contracts, break down institutional obstacles, and promote market-based approaches for both commercial banks and borrowers. the principle of independent negotiation and dynamic adjustment.
in this way, after the establishment of a market-oriented mechanism, the existing mortgage interest rates can be dynamically adjusted according to market interest rates, which completely solves this problem from a mechanical perspective.
in this adjustment of real estate policy, the central bank must be praised. it is very impressive. under the current environment, this is the biggest policy the central bank can achieve!
the politburo meeting also mentioned the need to adjust housing purchase restriction policies, reduce existing mortgage interest rates, improve land, taxation, banking and other policies, and promote the establishment of a new model of real estate development.
this time, major cities didn’t drag their feet:
on the evening of september 29, shanghai first optimized its real estate policy and adjusted the purchase restriction policy. in addition, the value-added tax exemption period for the transfer of personal housing was adjusted from five years to two years, while guangzhou, as previously expected, completely canceled it. as for the purchase restriction policy, shenzhen has retained purchase restrictions in core areas, but has also significantly relaxed the conditions for non-household registered residents to purchase houses. at the same time, it has canceled purchase restrictions in non-core areas. the value-added tax exemption period has also been adjusted from five years to two years.
among the four first-tier cities, although beijing has not yet made the latest adjustments, there is a high probability that corresponding policies will be introduced before the long holiday.
after this adjustment, i personally believe that from a broad policy level, all major policies have been basically implemented. considering the intensity of this policy, the market should respond positively.
｜i personally have several judgments about the next step of the real estate market:
first, the market's pessimistic expectations will be reversed to a certain extent, the market's positive factors will increase, and there is a high probability of a short-term rebound in trading volume:
second, considering the current fundamentals of the real estate market, it will not be easy to truly stop the decline and rebound at the end of the year. we also need to work harder to clear risks, such as the issue of guaranteed housing delivery, for example, the risk issues of real estate companies;
third, everyone must realize that the real estate market has entered a new cycle, and policies including purchase restrictions have basically withdrawn from the stage of real estate history. the construction of new models and systems is the top priority in the future;
fourth, in terms of market demand, the market is moving from the incremental era to the stock era. improvement demand is the mainstream, and the policy system needs to be further optimized for improvement demand.
(this article represents only the author’s personal views)
