War for Population Gets Central Govt Approval as Hunt for Current GDP Growth Intensifies

"From the point of view of the talent policies issued by various places, the current talent standards have continued to decline, and a large extent has begun to become a manpower dispute." -Zhang Dawei

Bloomberg: China’s Easing of Residency Requirements Could Boost Cooling Property Market

China’s latest step to encourage 100 million rural citizens to move to cities may provide a timely boost to a slowing property market.

Cities with an urban population of between 1 million to 3 million should scrap the residency registration system -- known as hukou -- this year, the National Development and Reform Commission said Monday. Cities with a population of 3 million to 5 million should substantially ease residency requirements.

What's notable here isn't the policy, but that it's more or less putting a stamp of approval on the war for population.

The War for Population Loosens Real Estate Restrictions

Cities that attract population are growing, cities that lose population are shrinking. The battle for population is a battle for raw GDP growth.

I am confident we'll see some cities blow a housing/development bubble as this war heats up. Probably not in popular destinations with fundamental growth prospects, rather the lower-tier marginal cities with little to offer except another round of real estate speculation.

Chinese coverage at iFeng: 城区人口300到500万的全面放开落户，哪些城市最受益？

The China Urban Construction Statistical Yearbook, which is published annually by the Ministry of Housing and Urban-Rural Development, is the most detailed statistics of the urban population of major cities. According to the 2017 Urban Construction Statistical Yearbook, combined with public information, statistics show that there are currently 13 cities with a population of more than 5 million in the city, except for the four super-large cities of Beishangguangshen and Shenzhen, Chongqing, Chongqing, Chengdu, and Chengdu. Nanjing, Zhengzhou, Hangzhou, Shenyang and Changsha are mega cities.

That is to say, in addition to these 13 cities in the future, all other cities will be fully open and wide-ranging restrictions. In this process, a large number of second-tier cities have benefited the most. Including Xi'an, Suzhou, Hefei, Jinan, Qingdao, Dalian, Xiamen, Ningbo, Kunming, Shijiazhuang, Nanchang, Fuzhou and other cities.

On March 18 this year, Shijiazhuang, the capital of Hebei Province, announced that it had cancelled the restrictions on the immigration conditions of “stable housing and stable employment” in urban areas and urban areas, and fully opened urban areas and urban settlements. National citizens can move to the urban, county (city) urban areas and the established towns only by the resident ID card and household registration book, and the spouses, children, and parents of both parents can move along with them. Shijiazhuang has thus become the first provincial capital to implement the zero threshold.

As the provincial capital of Hebei, a populous province, Shijiazhuang completely opened the threshold for settlement, which is also a landmark event in the household registration reform. Before Shijiazhuang, although some provincial capitals still had certain thresholds for settlement, the threshold was already low, and many provincial capital cities could settle down.

Zhang Dawei, chief market analyst of Zhongyuan Real Estate, analyzed the first financial analysis. At present, the urbanization rate of the registered population in China is 16% lower than the urbanization rate of the resident population. Most of these are in the city and cannot be settled. In particular, due to the fact that the degree of education is below junior college, it is quite large in the second-tier cities. Therefore, the opening and closing of these cities will help accelerate the urbanization of the household registration population and accelerate the economic and social development of these cities.

Zhang Dawei discusses the war for population as the standard of "talent" drop to anyone with a pulse under the age of 50:

"From the point of view of the talent policies issued by various places, the current talent standards have continued to decline, and a large extent has begun to become a manpower dispute." Zhang Dawei, chief market analyst of Zhongyuan Real Estate, said that the increase in population will inevitably lead to land and financial indicators. increase. In particular, as the land index increases, the city can deploy in a larger space, develop more industries, enlarge and strengthen the city scale, and enhance the city's ability to gather radiation. Therefore, the increase in land indicators is a big plus for the second-tier cities in many cities and the third- and fourth-tier cities around the metropolitan area. The focus of future real estate market development is also in these cities.

The president of Evergrande explained it directly:

Population inflows have also become an important indicator of the market layout of enterprises. On March 26 this year, at the 2018 annual results conference held by China Evergrande (03333.HK), Xia Haijun, president of Evergrande Group, said, “How to treat the market in first- and second-tier cities and third- and fourth-tier cities” Now the evaluation system of first- and second-tier cities and third- and fourth-tier cities is outdated. Now the urban layout mainly depends on whether there is a net inflow of people and whether there is industrial support.

The entire developed world and now China are cannibalizing themselves in the hunt for more GDP.