China's First Tier Goes International

This article originally posted in Shenzhen Daily closes by saying that aside from a real estate tax, first-tier prices will not decline because (in not as many words), China's first-tier cities are becoming international cities. International capital is also returning because fears of depreciation are lifting and interest in China is picking up.

iFeng: 一线城市房价正接轨国际大都市 后续还会涨?
The day before yesterday the news: the economic situation in the first quarter CBRC internal meeting, has allowed banks to real estate development loans the appropriate extension. Although this is an update, but it seems to say it is actually already happened at least two months things. This month, the real estate situation has undergone profound changes.

I must say that this is not an isolated event, but the management of the debt crisis in the part of the systematic approach, others such as the replacement of local government debt, banks are not allowed to vote under construction in the city was evacuated platform project loans, etc., are In order to prevent a debt is debt chain Mars ignite the fuse, the powder keg which set off the entire debt. This is why the debt chain broke open house on foot quotient crash reports, the recent relatively rare, much less the beginning of less intensive - Oh, dun Daoxialiuren ah!

On the real estate industry itself, at least the kind of debt liquidation auction because the supply of housing to bring focus, and thus bring a chain reaction of panic clear inventory at fire-sale blocked. This is also the product of a unique system with Chinese characteristics, if it is pure market behavior, which would have triggered a chain reaction. Of course, as the Federal Reserve to buy bonds does not mean that the debt will disappear like debt rollover does not mean that the debt settlement, which means it is only a temporary bandage to stop bleeding, to prevent further deterioration of the wound to be able to grow new flesh on the old record come.

It should be said, the effect is obvious. Rates tier cities, especially Shenzhen, the local housing prices jumped the most recent, is illustrative. Not much to say, record a recent report:. "New Deal enacted from 3.30 less than two months, a number of hot spots in Shenzhen, such as the former sea, Longhua, Bao middle area jumped, housing prices soared nearly 40%" stocks had super power, the yuan abnormal strong, continued easing of the real estate policy, the downward trend in interest rates, which all work together to change the real estate one-sided pessimism, so that the population inflow especially in first-tier cities housing prices reverse. All this interaction, in turn, changed the international hot money is expected, they again do more to China.

Cited two cases, one is Shangzheng Bao reported that foreign office market to return to first-tier cities, optimistic about its potential for appreciation, recently Shanghai office project triggered a bidding offshore funds, including Blackstone have famous; the other is the British Financial Times Yesterday's report, including Goldman Sachs, Citigroup, Credit Suisse this international investment bank, recently a profit hypertrophy business is financing for the Asian tycoon, "so that it can invest in China's stock market soared." back to China International Capital profit, We observe the current real estate market is an important prerequisite background.

In the case of expectations for a large depreciation in the Chinese yuan reversing, international capital is once again positive on China, China's real estate market is expected to get back on track. Notice, in April of real estate investment growth was a mere 0.5%, which in any case, it is difficult to say it is normal. At present, China's real estate, it may have been saturated in the aggregate, but in the structure, there is a huge gap, because a considerable number of our house, is covered in the population is out of the western town. We had hoped to build a house as attractive, but the logic is wrong, man has always been to build a house, people where to go, where demand for real estate will appear.

In this sense, the first-tier cities and major cities in the national strategic layout, such as the joint development of Beijing, Tianjin, the Yangtze River economic belt along the way as well as the construction of an important node in the city's housing prices are expected to stabilize, rebound, to resume its rally. No matter how unhappy readers and friends, I have to tell you a fact of life: housing prices in first-tier cities are on the way with the international standards of metropolitan housing prices, but also in the visible future, both inside and outside the city line Rate this time in the final practice before, unless the introduction of real estate tax, otherwise it will be impossible to see the possibility of major setbacks and callbacks tier cities housing prices.

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