Chinese Officials Fear Stimulus Will Ignite Housing Market

Although most analysts think government home buying restrictions will finally work, there were signs of rising buying interest as soon as the government announced fiscal stimulus and monetary easing.

21st Century: 7月调控次数创新高，严防楼市预期“燥热”

On July 27, Zhang Bo, chief analyst of the 58th Housing Research Institute, said in an interview with the 21st Century Business Herald that the property market has not warmed since the central bank’s continuous public release in July. From the online performance of Anjuke, from July 23rd to July 26th compared with July 16th to July 22nd, the proportion of cities with decreasing daily user browsing is relatively higher, and the number of users browsing is increasing. The cities include Zhengzhou, which rose by 3.23%, Suzhou, which rose by 3.53%, and Changchun, which rose by 5.53%. The cities with more obvious declines include Chengdu, which fell by 5.29%, Chongqing, which fell by 3.13%, and Xi'an, by 4.71%.

However, Zhang Bo believes that the operation of the central bank in July did not directly affect the buyers. The cooling of the hotspots is still continuing, but the impact on the housing enterprises cannot be ignored. In the second half of the year, the overall economy will be “de-leveraged”. Under the background of “stable leverage”, the gates of monetary policy have begun to adjust, and the “thirst” of housing firms is expected to be alleviated.

Regulators are striking hard and striking early to prevent renewed speculative bubbles. Which, to the speculator, makes buying real estate all the more attractive. Price controls in Ningde will only stoke demand as credit eases.

Whether the fine-tuning monetary policy will once again trigger a new round of hotspots in the real estate industry is not known, but real estate regulation has pioneered a new round of "strike hard" mode. Up to now, more than 40 cities have issued various real estate regulation and upgrading policies in July, with a cumulative total of more than 40 times. The number of such adjustments has refreshed the record of the property market regulation in the past two years. According to the incomplete statistics of the 21st Century Business Herald reporters, the regulatory policies introduced by various cities since July involve many aspects. This includes further standardizing the behavior of enterprises purchasing commodity housing, standardizing the order of commercial housing sales, comprehensively rectifying Internet real estate agents, combating the phenomenon of “yin and yang contracts” and “high evaluation of high loans” in the second-hand housing market, combating illegal crimes in real estate and suspending individuals Real estate mortgage business and so on.

The 21st Century Business Herald reporter noted that individual cities have even set a ceiling for the increase in the proportion of regulated housing prices. On July 10th, Fujian Ningde City issued a notice that the average price of new commercial housing in the central city is on the basis of the degree of January 2018 (8882 yuan / square meter), the annual increase is controlled within 6%, ordinary high-rise residential (blank) pre- The average price of the sale is subject to the maximum price, and the maximum control is within 11,000 yuan / square meter. It is worth noting that in the regulatory policies introduced in July, the third- and fourth-tier cities including Ningde, Linyi, Zaozhuang, Dali, Chengmai and Xishuangbanna seem to occupy the mainstream.

Officials best bet may be a bubble somewhere else, such as the A-share market. Otherwise, speculators, investors and homebuyers alike will find ways to leverage up and buy homes at artificially suppressed prices.

Ouyang Jie said that fixed assets investment and real estate investment must be stable under the trend of a large decline in the probability of export and consumption growth. Policy regulation and control should mainly be used to make up the nails and finely adjust. It is necessary to avoid the risk of foam caused by partial overheating in the property market, and to prevent the excessive pressure from causing the expected collapse.

Due to the fine-tuning of macro policies, the industry has also begun to show optimism. "There are still many new opportunities, such as the demand for home purchases is still relatively strong, which is also likely to bring about a rise in the price of the property market." Yan Yuejin said.

The 21st Century Business Herald reporter noted that under severe control, the illegality of the real estate market is still growing. Some properties are still trying to break through the restrictions in some ways. This shows that macroeconomic regulation and control with administrative regulation as the main feature still cannot be relaxed.