What are the new changes in the real estate market?, Zhengzhou takes the lead in officially announcing the policy of "recognizing houses but not loans" | Real Estate | He Xin

After multiple departments have made intensive statements on optimizing real estate policies in different occasions, Zhengzhou, the capital city of Henan Province with a population of over ten million, has once again been at the forefront of adjustment.

On August 3rd, the Zhengzhou Housing Security and Real Estate Management Bureau and other departments jointly issued a notice on further promoting the stable and healthy development of the real estate market in our city, issuing 15 new policies for regulating the real estate market, including implementing the policy of "recognizing houses but not loans", suspending the implementation of sales restrictions, and orderly lowering the interest rates of existing housing loans.

The first hot city to clearly state "recognizing houses but not loans"

"Implement a dynamic and long-term mechanism for adjusting the interest rate of personal housing loans for newly issued first homes, and timely adjust the lower limit of the interest rate of commercial loans for newly issued first homes in our city based on evaluation results. Implement the policy of 'recognizing a house but not a loan' to better meet the needs of basic and improved housing. In the new policy released by Zhengzhou this time, the part of providing financial credit support has attracted special attention.".

Analysis shows that Zhengzhou has become the first hot city to comprehensively introduce real estate regulation policies after the official proposal of "timely adjustment and optimization of real estate policies", and also the first provincial capital city to explicitly announce the implementation of "recognizing houses but not loans".

"Zhengzhou clearly mentioned the implementation of the 'house recognition but not loan recognition' policy, which has a strong signal significance and is the first city in the country to mention this content in the system documents." Yan Yuejin, Research Director of E-House Research Institute, said that previously, Chifeng, Inner Mongolia, also stated that the 'house recognition but not loan recognition' policy will be implemented, but mainly in the field of housing provident fund.

Cao Jingjing, General Manager of the Index Research Department of Zhongzhi Research Institute, mentioned that the current policy implemented in Zhengzhou is "recognizing loans but not houses", which means that families who have a house and have already paid off their purchase loan will implement the first home loan policy, which is already relatively loose.

"The policy also mentions' encouraging commercial banks in Zhengzhou to adjust the interest rates of existing personal housing loans in an orderly manner in accordance with the law ', which is also the first hot city after the central bank issued a statement on August 1 to clearly adjust the interest rates of existing housing loans. Cao Jingjing said that this is also a concern for the market and homebuyers at present.".

In response to the statement of "implementing a long-term mechanism for dynamic adjustment of housing loan interest rate policies," Yan Yuejin expects that this will provide more flexibility for the subsequent reduction of housing loan interest rates. In order to reduce the burden on homebuyers and increase consumer demand, there may still be room for a decrease in mortgage interest rates in the future.

The sales restriction policy continues to be relaxed

The Notice points out that for those who purchase improved housing, their original housing shall suspend the implementation of the previous document's requirement that "within the administrative area of Zhengzhou City, housing purchased after May 3, 2017 shall not be listed or transferred for less than 3 years from the date of obtaining the Real Estate Ownership Certificate".

In the view of Dong Ximiao, Chief Researcher of Zhaolian Finance, the suspension of sales restriction policies is also worth paying attention to. Previously, under overly strict purchase and loan restrictions, it was difficult for residents to fully meet their demand for improved housing, which is an important reason for the current difficulty in improving housing consumption.

According to the 3-year sales period, some properties subscribed during the 3-year period do not have an immediate opportunity for resale. However, the current lifting of sales restrictions has very good guiding significance. Yan Yuejin believes that the properties of homebuyers can be resold and revitalized, which has a positive effect on the release of demand for house changes and also has a positive and important impact on the destocking of large apartment units in Zhengzhou.

He said that this is also a policy trend for many cities this year. In June, Fujian Fuqing was the first to lift sales restrictions, which also indicates that from the perspectives of reducing constraints, activating housing liquidity, and encouraging the release of demand for improved housing, the lifting of sales restrictions will be a very important feature at present.

According to the Kerui Research Center, more than half of the first half of the year saw a loosening of restrictive home purchase policies. Among them, 14 cities including Guangzhou, Changsha, Xiamen, and Wuhan have relaxed purchase restrictions; Hunan Province and more than ten cities including Qingdao and Hefei have relaxed loan restrictions; Seven cities including Shenzhen, Changzhou, and Wuxi have relaxed price limits; Zhengzhou, Xiamen, Qingdao and other cities have relaxed sales restrictions.

Li Yujia, Chief Researcher of the Housing Policy Research Center of Guangdong Provincial Urban Planning Institute, believes that the suspension of sales restrictions is to activate the demand for replacement housing, but in the current context, the possibility of increasing the number of second-hand housing listings should be considered.

"At present, the number of second-hand housing listings in Zhengzhou has reached about 150000 units, setting a new historical high. If the overall environment and fundamentals of the real estate market remain unchanged, simply withdrawing from the restrictions may lead to some property owners listing and selling houses, further increasing the number of listings and continuing to suppress market expectations," said Li Yujia.

On the evening of August 4th, data from Zhuge's housing search website showed that out of nearly 142000 second-hand housing units available for sale in Zhengzhou, more than 2100 were newly added, with 680 units sold at reduced prices within 24 hours and only 59 units sold at increased prices.

Why is Zhengzhou leading the way?

Throughout the current cycle of real estate policy adjustments, Zhengzhou is a city with a relatively high frequency of occurrence.

For example, in April this year, Zhengzhou adjusted its sales restriction policy to be based on online signing time, deed tax payment time, and real estate registration time. Any one of the three can be sold after one year. At the same time, policies such as the cancellation of purchase restrictions outside the Second Ring Road, the transfer of housing provident fund with collateral, and support for the withdrawal of housing provident fund for down payment have also been introduced.

Cao Jingjing stated that this policy also mentions measures such as deed tax subsidies, housing purchase subsidies, housing provident fund support, reduction of housing transaction taxes and fees, and installment payments for land, all of which have a positive effect on improving market expectations. The concepts of both renting and purchasing, urban village renovation, and other related initiatives are consistent with recent central and ministerial proposals. It is expected that the process of housing ticket resettlement and monetization resettlement will continue to advance.

The series of deployments in Zhengzhou are closely related to the current state of the real estate market. According to data from Kerui, the transaction volume and supply of new housing in the main urban area of Zhengzhou showed a significant decline in July, with residential transactions of about 400000 square meters, a month on month decline of about 21%, marking the sixth consecutive month of decline.

An industry insider in Zhengzhou has deeply experienced the changes in the local market: "Sales have been quite sluggish recently. My community is a subway house with good location and supporting facilities. During this period, the housing price per square meter has decreased by more than 2000 yuan. This measure is still quite practical and timely. If implemented well, I think it will be more effective than the 'Zheng 19 Regulations' released last year."

He specifically mentioned that Zhengzhou's real estate is currently in a buyer's market where supply exceeds demand, with a large number of listings. There are still many issues with project shutdowns that have not been fully resolved, leading people to be more inclined to buy second-hand houses. The new policy also timely proposed to list one project each in Zhengdong New Area and Huiji District as a pilot for "selling existing houses", and the "hard and hard" rule of "paying with one hand and delivering houses with the other" made him more hopeful.