Source: Financial Services Association Author: Li Jie
① With the regulatory authorities announcing a major property market policy on May 17, the era of the most relaxed property market credit has arrived, the effects of the policy in various regions have gradually begun to show, and buyers' willingness to enter the market has increased markedly. ② Currently, only the reduction in interest rates on the Provident Fund has been implemented. Other policies such as commercial loan interest rates, down payment ratios, and stock housing purchases have yet to be gradually implemented, and the market popularity will further increase at that time.
As the supervisory authorities announced a major property market policy on May 17, the era of the most relaxed property market credit has arrived, and the effects of the policy have gradually begun to show in various regions.
According to Central Plains Real Estate data, on the first weekend after the central bank's “Four Arrows” helped the property market (May 18-19), the average daily second-hand housing transactions in Beijing once again surpassed 1,000 units. Among them, over 900 units were sold on May 18, more than 1,100 units were sold on May 19, and a total of more than 2,000 units were sold over the weekend, basically reaching the popularity of Xiaoyangchun in 2024. In addition, transactions for some new housing projects have also shown signs of heating up.
On the Shanghai side, the reporter learned that on the first weekend after the release of the new property market policy, there was a sharp increase in the number of new customers and visitors to second-hand housing agency stores in Shanghai, and there was a marked increase in the number of visitors from buyers interested in selling properties in various new housing projects. Meanwhile, there has also been an increase in the number of visitors from many sales offices in Guangzhou who intend to buy them.
Also, look at Shenzhen and Shenzhen Zhongyuan real estate statistics. Over the past two days (May 18-19), new housing transactions in Shenzhen rose 90% month-on-month compared to last weekend, and second-hand transactions rose 60% month-on-month.
In addition, according to statistics from Leyoujia, the largest local intermediary agency in Shenzhen, the number of second-hand properties viewed in Shenzhen stores over the weekend rose 127% over the weekend since this year, becoming the highest point since 2018, surpassing the historical peak in the second quarter of 2020; second-hand sales in stores rose 117% from the average weekend since this year, and single-day sales volume on May 19 hit the highest point since February 2021.
“This policy is a combo punch issued at the regulatory level. It shows the determination of the supervisory authorities to support the property market. It is stronger than in 2008, and the boost in market confidence is unmatched by previous local policies. As a result, it can be seen that after the policy was introduced, buyers' willingness to enter the market increased markedly, and market transactions increased dramatically.” Analysts at the Shenzhen Central Plains Research Center told reporters.
Meanwhile, in Hangzhou, monitoring data from the Hangzhou Shell Research Institute showed that the number of second-hand housing inquiries on the first day after the New Deal increased by 54% per day compared to April. In the new housing market, the popularity of finding a new home online on the first day after the New Deal increased 149% compared to the previous day, according to data from 58 home buyers.
On May 17, the Central Bank and the General Administration of Financial Supervision issued three policies in succession, announcing a reduction in the down payment ratio for commercial personal housing loans, abolishing the lower interest rate limit on mortgages, and lowering interest rates on personal housing provident fund loans. Furthermore, on the same day, a video conference on how to effectively secure housing was held in Beijing to make arrangements to support state-owned enterprises to acquire commercial housing that have already been built and not sold, revitalize existing land, and secure surrender buildings.
A number of analysts said that after the policy adjustment, the down payment ratio and mortgage interest rate will all be at historic lows, which will drastically reduce the home purchase threshold and home purchase cost, and reduce residents' home purchase threshold and mortgage interest costs to the lowest in history.
Subsequently, housing provident fund centers in many places responded positively to the central government policy and lowered interest rates on provident fund loans one after another, and stock provident fund loans will also change on the next pricing date.
Some analysts said that the popularity brought about by the property market loosening policies introduced several times in recent years is relatively weak. So, how long will the impact of this round of policy relaxation on the market last?
Zhang Dawei, chief analyst at Central Plains Real Estate, believes that there are many major policies coming out of the supervisory authorities, but at present, only the Provident Fund policy interest rate cuts have been implemented in the country; as far as the market is concerned, it is expected that the impact of the policy will gradually become apparent in the market after this week.
“Looking at previous policy adjustments, such as policies such as optimizing housing and not granting loans, adjusting down payment ratios, and lowering interest rates, etc., some favorable policies may continue to have a market popularity effect for about half a month, and the effects of this policy are expected to last longer.” The analyst at the Shenzhen Central Plains Research Center mentioned above told reporters, but it also depends on the strength of specific policies. Currently, only the reduction in interest rates on the Provident Fund has been implemented; others, such as commercial loan interest rates, down payment ratios, stock housing acquisitions, etc., have yet to be implemented, and the continued popularity of the market requires the gradual implementation of these policies.
“Currently, online signature data does not reflect policy changes. The policy mentions that the down payment and interest rates will be adjusted, how cities such as Beijing will implement it, and all regions need to be further clarified. Some buyers who are not in a hurry to sign online are still waiting for the policy to be implemented. As a result, online signing may be delayed appropriately to enjoy the benefits of the policy.” Zhang Dawei told reporters.
A number of analysts interviewed believe that overall, the market impact brought about by the current policy is fermenting, and market popularity will further increase after implementing policies to lower down payment ratios and mortgage interest rates in many places.
“A series of real estate policies shows that the attitude towards a shift in high-level policies is clear. Continued relaxation will be a major trend. The greater the pressure on fundamentals, the more relaxed it will be.” Securities analysts at Zhongtai Securities think.
Huaxi Securities analysts said that the real estate policy is currently in a continuous easing phase from top to bottom, and the real estate market is expected to recover with the release of major favorable policies.
edit/lambor