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on september 26, the political bureau meeting of the central committee of the communist party of china proposed “promoting the real estate market to stop falling and stabilize”, sending a rescue signal for the real estate market from the highest level. in response, four major first-tier cities have relaxed purchase restrictions. first-tier cities serve as benchmarks for the national property market. considering that the stock market has surged recently due to policy stimulus, will the property market rebound as sharply as the stock market?

among the four first-tier cities, guangzhou has taken the most thorough steps to lift purchase restrictions, completely lifting various purchase restriction policies.regardless of whether you have a local household registration or a foreign resident, you can freely buy a house in guangzhou without any restrictions. after guangzhou’s purchase restriction policy lasted for 14 years, it has completely returned to normal.

although the purchase restrictions in shenzhen, shanghai and beijing have not yet been fully opened, they are also being relaxed step by step. for example, shenzhen no longer has any purchase restrictions in non-central urban areas, shanghai and beijing have lowered the social security or individual tax requirements for non-locals, etc. . under the central government's requirements for real estate to stop falling and stabilize, it is expected that shenzhen, shanghai and beijing will lift purchase restrictions to an increasingly larger scale, and it is not ruled out that they will eventually be completely relaxed.

so, as first-tier cities gradually relax purchase restrictions, will house prices rebound? especially recently, the country has introduced a series of combinations to stimulate the economy, and the stock market has been completely detonated. will the property market, like the stock market, rebound quickly due to favorable policies? ?

it is unlikely that the property market will surge as quickly as the stock market.

first of all, the stock market is a place suitable for short-term operations. driven by investor enthusiasm and large-scale capital, stock prices can be quickly driven up in a matter of days. moreover, many speculative funds can easily move in and out of the stock market quickly, making short-term gains and then leaving the market quickly.however, the property market is not suitable for short-term operations. it takes a long period from entry to cash out. therefore, it is destined that it is difficult for short-term funds to flow into the property market on a large scale.

secondly, the reason why the a-share market can be ignited, in addition to policy stimulus, is also because the a-share market is already low enough. the a-share market has been hovering around 3,000 points for a long time. except for a few bull markets, it has been consolidating or consolidating most of the time. downward range. judging from the valuation level, the price-to-earnings ratio of a-shares is already at a historical bottom and lower than international levels.

but the property market is completely different. after 20 years of rapid growth, domestic housing prices are already at an extremely high position. even though they have declined in recent years, they are still very high. in terms of the housing price-to-income ratio, domestic housing prices, especially in first-tier cities, are housing prices are also among the highest globally. compared with the stock prices in the a-share market, domestic housing prices have not fallen far enough, making it difficult to attract large-scale capital.

more importantly, the supply and demand relationship in the property market makes it difficult for housing prices to rebound significantly.

our country's real estate market has passed the era of shortage. both the per capita housing area and the per capita number of housing units are already at a high level internationally. it is against this background that the central government made an important judgment on my country's real estate market last year - the supply and demand relationship in my country's real estate market has undergone major changes.

even in first-tier cities, property market inventory is at extremely high levels. it is under the pressure of high inventory that the housing trade-in model has become more and more popular, and more and more local governments have begun to encourage state-owned assets to acquire and store housing.

if the lifting of purchase restrictions can stimulate the property market, there needs to be an important prerequisite, that is, there is still a lot of demand in the current market, because the purchase restrictions policy has blocked the door.therefore, once purchase restrictions are lifted, these demands can flood in and promote the recovery of the property market. but the reality is that, except for a few people who have permanent residence in other places and are not eligible to buy houses because of the purchase restrictions, there are very few real needs that are blocked by the purchase restrictions. the so-called lifting of purchase restrictions will usher in a large number of home buyers, which is more of an illusory imagination. .

whether the lifting of purchase restrictions will stimulate the rise in housing prices, many cities have already given the answer. over the past year or so, except for the four major first-tier cities, most cities in china have completely relaxed purchase restrictions. so, how many cities have seen housing prices rise due to the lifting of purchase restrictions? none.

will the relaxation of purchase restrictions in first-tier cities make a difference? among all domestic cities that have relaxed purchase restrictions, the one closest to first-tier cities is xiamen. xiamen's housing prices have always been the fourth highest in the country, second only to beijing, shanghai and shenzhen, and higher than guangzhou. therefore, if we only look at housing prices, xiamen is a well-deserved first-tier property market.

in november 2023, xiamen fully relaxed its purchase restriction policy, and the purchase of first-hand and second-hand commercial housing in the city (including the island) will no longer be reviewed for the qualifications of home buyers. so, after xiamen’s purchase restrictions were lifted, did house prices surge?

according to data from the national bureau of statistics, in the first two months after the purchase restrictions were fully relaxed, the prices of new housing and second-hand housing prices in xiamen not only did not rebound at all, but continued to fall. after entering 2024, xiamen's housing prices have accelerated their decline. in august this year, xiamen's new housing fell by 10.7% year-on-year, and second-hand housing fell by 14.6% year-on-year, ranking first in the national property market.

xiamen island has always been regarded as a place where every inch of land is at a premium. many people believe that if xiamen relaxes purchase restrictions, wealthy people from around xiamen and even from all over the country will flock to xiamen to buy houses. but in fact, after xiamen relaxed purchase restrictions, housing prices fell at an accelerated pace, leading the decline nationwide, and there was no panic buying as imagined.

this fact fully shows that the scarcity of supply in the current property market no longer exists, and what is truly scarce is demand.in the context of increasing supply and decreasing demand, the real significance of relaxing purchase restrictions is to facilitate some rigid needs and change the psychology of buyers and sellers in the short term. however, in the medium to long term, it cannot change the nature of the property market. fundamental direction.

although this round of policy stimulus has ignited the stock market, it is difficult to have the same effect on the property market. even the policy goal is to "stop falling and stabilize" the property market, rather than "stop falling and pick up."for the current property market, being able to stop the decline is already a positive signal.

source: sanlian life weekly