The support policies for the real estate industry have been strengthened again! The People's Bank of China and the State Administration of Financial Regulation issued documents to support | real estate | central bank
After the reduction of LPR quotations for more than 5 years and the guidance of downward mortgage interest rates for residents, the support policies for the real estate industry have once again intensified.
The People's Bank of China and the State Administration of Financial Supervision and Administration issued a notice on July 10, stating that if the relevant policies of the People's Bank of China and the China Banking and Insurance Regulatory Commission on doing a good job in supporting the stable and healthy development of the current financial support real estate market have an applicable period, the applicable period will be uniformly extended to December 31, 2024.
The policy extension involves two aspects, with a focus on the real estate supply side. Market analysis suggests that this will help further alleviate the financial pressure on real estate companies, reduce financial institutions' risk concerns about real estate loans, promote "guaranteed delivery of properties", and boost confidence in the real estate market.
Extend the applicable period of relevant policies
This policy extension involves two aspects.
Firstly, for the existing financing of real estate enterprises such as development loans and trust loans, while ensuring the safety of creditor's rights, financial institutions and real estate enterprises are encouraged to negotiate independently based on commercial principles, actively support through methods such as extending existing loans and adjusting repayment arrangements, and promote project completion and delivery. For loans that expire before December 31, 2024, an extension of one year beyond the original regulations is allowed, and the loan classification may not be adjusted. The loan classification submitted to the credit reporting system shall remain consistent with it.
Secondly, for commercial banks that provide supporting financing to special loan support projects before December 31, 2024 in accordance with the requirements of the Notice, the risk classification will not be lowered during the loan term; After the debt is divided between new and old, the lending entities shall be managed as qualified borrowing entities. For newly issued supporting financing that results in non-performing loans, relevant institutions and personnel who have fulfilled their duties can be exempted from liability.
Dong Ximiao, Chief Researcher of Zhaolian Finance, stated that the "Notice" issued by the People's Bank of China and the State Administration of Financial Supervision and Administration will to some extent dispel the concerns of financial institutions, further change the situation of financial institutions being hesitant or unwilling to lend, encourage financial institutions to provide supporting financing for special loans to support projects, further improve financing for real estate enterprises, stabilize market confidence and expectations, promote stable and healthy development of the real estate market, and better assist in the sustained recovery of the macroeconomy.
On November 11, 2022, the People's Bank of China and the former China Banking and Insurance Regulatory Commission jointly issued a notice, clarifying 16 support policies from the aspects of maintaining stable and orderly real estate financing, actively providing financial services for guaranteed delivery of buildings, cooperating with distressed real estate enterprises in risk disposal, and increasing financial support for housing leasing. Two of these policies specify the applicable period.
Officials from the People's Bank of China and the State Administration of Financial Supervision and Administration stated in response to questions from reporters that the implementation of the Notice has played a positive role in maintaining reasonable and moderate real estate financing, promoting the resolution of risks for real estate enterprises, and has achieved good policy results. Taking into account the current situation in the real estate market, in order to guide financial institutions to continue extending the existing financing of real estate enterprises and increase financial support for guaranteed delivery of buildings, the People's Bank of China and the State Administration of Financial Supervision have decided to extend the applicable period of relevant policies.
The person in charge pointed out that apart from the two policies mentioned above, other policies that do not involve applicable deadlines are valid for the long term. Financial institutions should effectively implement policies in accordance with the requirements of the documents, support the demand for rigid and improved housing based on urban conditions, maintain reasonable and moderate real estate financing, increase financial support for guaranteed delivery of buildings, promote market-oriented clearance of industry risks, and promote stable and healthy development of the real estate market.
Stabilizing the real estate market will be an important driving force for stable growth
In order to promote the stable and healthy development of the real estate market, multiple market analysts believe that more supportive policies are expected to be accelerated in the future. In the process of implementing this round of stable growth policies, stabilizing the real estate market will be an important driving force.
Wang Qing, Chief Macro Analyst of Dongfang Jincheng, predicts that with a focus on guiding the real estate industry to achieve a soft landing as soon as possible, under the principle of implementing policies tailored to the city, various regions will continue to make efforts in moderately relaxing purchase and loan restrictions, increasing support for housing provident fund purchases, reducing taxes and fees in real estate transactions, and guiding residential housing loan interest rates to decline. In addition, on the basis of continuing to implement the special loan support plan for Baojiao Building, it is not ruled out that the quota will be increased in the third quarter, and even new targeted support tools may be launched.
"If various policies are adjusted in place, the real estate market is expected to stabilize and rebound by the end of the third quarter, and real estate investment will also rebound in the fourth quarter. This will not only effectively boost overall consumption and investment confidence, stimulate endogenous economic growth momentum, but also effectively prevent major economic and financial risks." Wang Qing said.
Dong Ximiao suggested that the next step should be to comprehensively adjust and optimize real estate financial policies, and extend the transition period for managing the concentration of real estate loans; Through measures such as the central bank's "three arrows" policy and policy bank special loans, we will increase liquidity support for high-quality real estate enterprises and continue to increase special support for "guaranteed delivery of buildings" projects; Support the reasonable extension of existing financing such as development loans and trust loans; At the same time, we will adjust and optimize housing credit policies according to local conditions, city specific policies, and district specific policies.