On October 17th, the State Council Information Office held a press conference, Minister of Housing and Urban-Rural Development Ni Hong, along with officials from the Ministry of Finance, Ministry of Natural Resources, banks, China Banking Regulatory Commission, introduced the relevant situation about promoting the stable and healthy development of the real estate market, and answered questions from reporters.

At the meeting, the Ministry of Housing and Urban-Rural Development, together with relevant departments, guided various regions to act quickly, implement existing policies, introduce new policies, implement a set of measures, and promote the stabilization of the market.

For this press conference, Wall Street News has compiled about 360 words of 10 key points:

1. Four cancellations: cancel restrictions on purchases, cancel restrictions on sales, cancel price restrictions, and cancel the standards for ordinary and non-ordinary residences.

2. Four reductions: reduce provident fund loan interest rates, reduce down payment ratios, reduce existing loan interest rates, and reduce exchange taxes and fees.

3. Two additions: implement the renovation of 1 million units of urban villages and dilapidated houses, and increase the credit scale of "whitelisted" projects to 4 trillion.

4. Special bonds will be used to purchase existing commodity houses for affordable housing, with decisions and implementation voluntarily determined by local authorities.

5. Policy banks and commercial banks are allowed to provide loans to eligible enterprises and acquire existing land.

6. Most existing housing loan interest rates will be batch lowered on October 25, and the results can be viewed on October 26. Overall completion is expected before the 31st.

7. Build good houses for public welfare housing, while finding ways to transform old houses into good ones.

8. For projects in debt beyond assets, accelerate bankruptcy reorganization or liquidation.

9. The adjustment of real estate value-added tax policies is being expedited to carry out relevant procedures, and will be promptly announced to the public.

10. By the end of the year, 4.5 million new residents and young people can move into affordable housing.

Ni Hong stated that China's real estate, under a series of policy influences, has been continuously adjusting for three years, and the market has begun to stabilize. The data for October will definitely show positive and optimistic results.

Real estate market combination: four cancellations, four reductions, two increases.

Ni Hong introduced at the meeting that in the future, the combination of punches will be “four cancellations, four reductions, two increases”.

The four cancellations mean giving full autonomy to city governments for regulation. City governments should adjust or cancel various restrictive measures for home purchases according to local conditions. Mainly includes canceling purchase restrictions, canceling sales restrictions, canceling price limits, and canceling standard requirements for ordinary and non-ordinary residences.

The four reductions refer to reducing the housing provident fund loan interest rates. As we all know, it has been reduced by 0.25 percentage points; reducing the minimum down payment for housing loans, unifying the minimum down payment ratio for first and second home loans to 15%; lowering the interest rates for existing loans; and reducing the tax burden for purchasing new homes through the 'selling old to buy new' scheme.

By implementing these already issued policies, it aims to lower residents' home purchasing costs, alleviate repayment pressures, and support both essential and housing improvement needs of residents.

The two increases involve adding 1 million sets of urban village renovations and dilapidated house transformations through monetizing settlement housing. By the end of the year, the credit scale for 'white-listed' projects will be increased to 4 trillion yuan, striving to include all qualified real estate projects in the 'white list'.

Five policy supports for renovating 1 million sets of urban villages and dilapidated houses.

Ni Hong mentioned that regarding the renovation of 1 million sets of urban villages and dilapidated houses, support may be increased according to the situation.

Regarding the criteria for projects to receive policy support, there are two points: first, priority selection should be given to projects where residents have a strong desire for renovation but face significant safety risks; second, the project's two plans must be mature: one is a solid relocation plan, and the other is a well-balanced fund management to ensure overall project stability and avoid new local debt risks.

There are five main supportive policies: first, support key cities at or above the prefecture level; second, provide special loans from developmental and policy-oriented financial institutions; third, allow local governments to issue special bonds; fourth, offer tax incentives; fifth, commercial banks disburse loans based on evaluations.

Special bonds are used to purchase existing commodity housing, decided and implemented voluntarily by local authorities.

Assistant Minister of the Ministry of Finance, Song Qichao, stated at the meeting that for the special bonds used to purchase existing commodity housing for affordable housing, this policy is decided and implemented voluntarily by local authorities, following the principle of legal governance, and according to market-oriented operations, while ensuring the balance of project financing returns, local authorities arrange special bonds to purchase existing commodity housing.

In the specific operation of using special bonds to purchase and store land, it mainly supports various regions to determine the purchase price reasonably in conjunction with the actual situation of existing landowners and enterprises, handle the debt relationship related to the recovery of existing land appropriately, determine the scope of special bond projects reasonably, and arrange the issuance and expenditure of special bonds in a timely manner.

Include all loans for commodity residential projects in the "white list".

Xiao Yuanqi, Deputy Director of the Financial Regulatory Administration, stated that as of October 16, loans approved for white-listed real estate projects have reached 2.23 trillion yuan; it is estimated that by the end of 2024, the approved loan amount for white-listed projects will double, exceeding 4 trillion yuan.

Since the beginning of this year, the urban real estate financing coordination mechanism has included compliant real estate projects in the "white list". The next step is to include all loans for commodity residential projects in the "white list", achieving comprehensive inclusion.

Research is being conducted to allow loans to be granted to conditional enterprises for the acquisition of existing land.

Deputy Governor of the People's Bank of China, Tao Ling, stated at the meeting that the People's Bank of China, in conjunction with relevant departments, is actively studying to allow policy banks and commercial banks to grant loans to conditional enterprises for the acquisition of existing land, with the People's Bank of China providing necessary refinancing support.

Deputy Minister of the Ministry of Natural Resources, Liu Guohong, stated that revitalizing the stock of idle land is a key focus of the current work of the Ministry of Natural Resources. In terms of controlling new additions, we have suspended the supply of land for residential properties in cities with longer inventory turnover periods.

In terms of revitalizing the existing stock, the Ministry of Finance has announced that special bonds will be allowed for land reserves. Specifically, we will prioritize undeveloped and unwillingly developed residential and commercial land that have not yet started construction. We will also collaborate with relevant departments to explore the establishment of special loans for purchasing existing land.

Four characteristics embody a good residence, and each region should first ensure that affordable housing is built into good residences.

Ni Hong stated that the public has new expectations for the functionality of residences, and a good residence should embody four aspects:

First, it should be green, allowing people to live comfortably and healthily; second, it should be low-carbon, saving money and energy throughout the entire life cycle of a residence; third, it should be intelligent, making it convenient for people to use modern technology; and fourth, it should be safe.

The next step is to apply new generation information technology, green low-carbon technology, new products, new materials, and new technologies to housing construction. Each region should first ensure that affordable housing is built into good residences. Government-led livelihood projects must take the lead; while also finding ways to transform old houses into good residences.

Currently researching to clearly cancel the tax policies connecting ordinary residences and non-ordinary residences.

Song Qichao stated that the Ministry of Finance is currently working intensively to clarify the cancellation of the tax policies connecting regular residences and non-regular residences, mainly including value-added tax and land value-added tax.

In terms of value-added tax, except for Beijing, Shanghai, Guangzhou, and Shenzhen, ordinary and non-ordinary residences are not distinguished. Beijing, Shanghai, Guangzhou, and Shenzhen exempt individuals from paying land value-added tax for the sale and purchase of ordinary residences for more than two years. We are currently adjusting the relevant tax policies, and specific policies are being implemented through related procedures.

Editor/Somer