Will Home Prices in 2016 Follow 2009 Script?

China unleashed a massive stimulus in 2008 in part because of falling home prices. The result was a boom that lasted until 2011. Now prices are rising again, but conditions are very different. A report from Industrial Bank draws the conclusion that more can still be done to boost the market, if needed. A few of the charts:

iFeng: 报告:本轮房地产在走2009年的路吗?

1) After the end of 2008 stimulus policies, we experienced a "real estate sales rebound" -> "price rise" -> "Land acquisition area growth" -> "new construction increased investment rebound" conduction, stimulating the steady rise of the economy;

2) Due to changes in the external environment and population structure, policies to stimulate the real estate after 2015, although the amount of the price rise, but not to bring investment growth, the real estate sector "to the inventory", "stable prices" stable household sector balance sheet is the government the main objective of the current round of regulation;

3) real estate and financial assets also changing the relationship, house prices and stocks, bond yields correlation positive correlation from 2011 gradually turned negative, to be concerned about "seesaw" effect between the assets;

4) four-tier cities real estate "to stock" is a national strategy, and in 2009 compared to the current stimulus is still room; inhibit tier cities prices rose too fast tactical goals, which means that the real estate policy will be differentiated.

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