The second and third tier purchases touched the property market, nerve housing prices ahead of schedule

On July 12, the State Council requested that second- and third-tier cities that have excessively fast house prices further implement policies such as purchase restrictions. Although the definition of “second-tier cities and third-tier cities” is still ambiguous, it is certain that the housing bubble that has not been bought into cities has caused high levels of regulatory concerns.

Under the cloud of purchase restrictions, developers have been squeezing their running capacity in the past few days, and the industry’s heated debate on purchase restrictions has not stopped.

Phenomenon: Unrestricted purchase aggravated bubble accumulation Seven years ago, the real estate development company where Chen Anning was located moved from Nanjing to Suqian Xiangyang. As the head of the company, Chen Anning had seen the speed of real estate development in the county town of Shenyang in these years. “There are many real estate projects around the new administrative center, and the land price in the same area has reached 2 million yuan/mu. The price of the surrounding project housing has already reached 3,000 yuan.”

In counties such as Xiangyang, foreign purchasing power is limited, and the main support for the market is local demand. "A county population of more than 100,000 people is counted as 3.5 people per household, but it is between 40,000 and 50,000 households. However, the supply of the local property market is as high as 1 million square meters in one year. According to an average of 100 square meters per household, there are 10,000 units. Despite the oversupply, the digestive power of the local property market is not weak. There are many families with two or three houses."

Sihong, the same city in Suqian County, is a hot spot for real estate development. According to Chen Anning, Sihong’s local property lending by usury is common. When tight control was imposed in 2008, it was difficult for developers to borrow money and borrowed loan sharks. The annual interest rate was as high as 60% to 70%. Even if the relationship with the lenders is better, the annual interest rate will be 30% to 40%. Now is a round of strict regulation, and the phenomenon that developers develop by means of usury has only increased. With the rapid development of local real estate and the rise of the usury industry, "raise" out a lot of rich BMW. However, Chen Anying thinks this is a terrible chain. Once someone falls, the entire market may be destroyed.

Wang Shuhua, an assistant researcher at the Institute of Economics of the Provincial Academy of Social Sciences, said that from the housing price data in recent months, most of the year-on-year increase in house prices over double digits is in second- and third-tier cities. “Because of the lack of investment channels and the existence of inflation expectations, people have been regarded as an effective measure to preserve and increase the value of property. After the first-tier cities and some second-tier cities limit purchases, real estate funds will surely be 'crowded' into the 23rd line. Restricting the purchase of cities has helped boost local house prices. On the contrary, the purchase of urban housing prices has been cushioned. The province’s purchases in Nanjing, Suzhou, and Wuxi have slowed down, and house prices have slowed down year-on-year. From January to June this year, house prices in Nanjing rose 1.94% year-on-year. , Suzhou rose 2.37%, Wuxi rose 4.16%. Xuzhou began to limit purchases since May, house prices rose relatively high year-on-year, 8.43%."

Hot discussion: whether it is "hit the mountain and shock the tiger" or "the rain is coming"

It is alleged that the Ministry of Housing and Urban-Rural Development is stepping up its efforts to select the list of restricted purchasers in second and third-tier cities. The relevant person of the Provincial Housing and Construction Department told reporters recently that at the moment there has been no further notification from the Ministry of Housing and Construction about a new round of purchase restriction. The “list” is not yet clear.

Some analysts believe that the restriction of purchase expansion is more of a "knocking on the mountain and shaking the tiger", and the psychological impact on the market is greater than the actual impact. Zhang Hui, secretary-general of the Nanjing Real Estate Development and Construction Promotion Association, stated that the purchase restriction should not be fully rolled out at once and form the stage of “all people going to the countryside”.

Capital is water, and it is profitable. There is a concern in the industry: Once the purchase restriction is extended to the second and third tier cities by the first-tier cities, the purchase of funds will likely continue to spread to all unaccepted regions. In this regard, local governments face great challenges. Wu Xianghua, deputy director of the Real Estate Department of Nanjing University of Technology, analyzed that current local liabilities are a big problem. Local governments mainly rely on land transfer payments to pay off their debts. Once restrictions are imposed on purchases, they will have a great impact on the development of local land finance and related industries. Under the pressure of ensuring the smooth operation of the local economy, whether or not to purchase and expand capacity will get the active response of local governments. It remains to be seen.

Wang Shuhua believes that investment, speculative capital into the per capita income, the ability to buy houses with lower payment capacity of the second and fourth tier cities, will lead to greater economic and social risks, therefore, the purchase of the necessary expansion. The affordability of ordinary people’s purchases should not be weakened by the rapid rise in housing prices.

Transaction: The developer changes the "restriction order" to "promotion order"

Although the list of newly-restricted cities has not yet been released, some developers have already used the “restriction order” to change “promotional orders,” and they want to quickly ship and sell quickly, and the number of homebuyers in non-restricted cities has also increased.

July 24, Anhui Zhangzhou high temperature 34 °C, the local Country Garden European City is urgently pushing 1500 suites source, the average price of high-rise residential sales launched on that day is only 3839 yuan / square meter, the average price of townhouses and double-row villas also Only 6,050 yuan / square meter and 8,200 yuan / square meter respectively. Due to the low total price and unlimited purchase, the site attracted about 2,000 prospective customers, most of them from Nanjing.

The day before, Jurong City, located in Jurong, launched more than 500 suites. The real estate sold a “down payment of 90,000 yuan”. It sold 350 suites on the opening day and the sales rate reached 70%.

The phenomenon of “rushing ahead” by developers has begun to emerge in cities such as Nantong. On July 21, the price of villas in Nantong was the first to decrease by 2,000 yuan, and the sales unit price was lowered from 13,800 yuan a week ago to 13,800 yuan. On July 23, a real estate in the core area of ​​the local new district launched 12 sets of special-purpose rooms and offered multiple discounts. In just over an hour, the number of on-site signed properties has reached more than 40 sets.

Chen Anning has now moved to Jurong Baohua to engage in villa development. He said, “The one-off payment amount is too high. If you don’t get a loan, you can't either approve it or you can wait for a long loan period. This loan is only available to developers. The days are hard.”

Capital is the "blood" of real estate development. Data show that from January to June, the province's new real estate loans were 77.214 billion yuan, a decrease of 65.111 billion yuan year-on-year, of which, personal home purchase loans and real estate development loans decreased by 58.547 billion yuan and 18.595 billion yuan respectively.

Even in cities that did not limit purchases, lending in the first half of the year was significantly reduced. For example, in the first half of the year, real estate loans in Yangzhou dropped by 38.7% year-on-year.

A Nanjing developer told the reporter that it is no longer possible to handle real estate trusts, and land mortgage loans are also difficult to do. "Now to go to a bank loan, almost all will say 'no credit', it is really necessary to loan, can only give deposit bills for six months, but also discount interest on their own."

In a situation where the funds are stretched, if it is necessary to deal with the difficulties of “restricting purchases,” developers can only use their brains for price strategies, and prices in the second, third, and fourth tier cities may “go ahead” or even “divide”.

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