Shantytown Renovation Drops 51pc

iFeng: 今年全国棚改计划开工量减少51%,三四线城市楼市怎么走? (This year, the construction volume of the national shantytown reform plan will be reduced by 51%. How can the property market in third-and fourth-tier cities go?)
However, from the year-on-year changes, there have been some ups and downs among provinces and cities, and the overall situation is "more falls than increases." Fujian, Tianjin, Guangxi, Guangdong, Tibet and other five provinces saw year-on-year growth. Fujian saw the most significant increase, reaching 117%. The planned construction volume of the remaining 31 provinces, autonomous regions and municipalities has fallen to varying degrees from 2018, with 15 falling by more than 50%. It is worth paying attention to Shandong, Henan, Guizhou, Hunan and other provinces that have changed their shanty towns, with year-on-year declines of more than 70%. We believe that the staged pullback in provinces with a large number of shed reforms in the early stage conforms to objective laws and market expectations. For example, in Henan Province, the actual amount of shed reforms in 2018 has reached 1.8 times that in 2016, and the planned target for 2019 is only 150,000 units, a 77% year-on-year decline, a significant decline, and a fall is also expected.
This was planned last year, but lack of funds is a partial explanation:
Kerri Real Estate Research Center believes that the tightening of the shed reform policy in 2019 is basically expected, especially under the background of relatively tight local finance, monetization resettlement and other methods will gradually exit, and the stimulating effect on real estate sales will also be weakened.
Last year in June there was a mini-panic when the policy change was announced, see Third and Fourth-Tier Cities Doomed As PSL Goes Away, Deleveraging Will Not End.

The change in shantytown renovation policy could intensify the war for population and diverging outcomes in local real estate markets:
In Zhang Bo's view, the direct benefits of the shed reform will accelerate and weaken in the next three or four lines and below cities, and the three or four lines cities will have obvious differentiation. In the future, cities in key urban agglomerations will have more population gathering power, and cities with contracted three or four lines and below will face further shrinkage of the commercial housing market.

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