The policy frequently releases signals, and the head housing enterprises welcome the good news again. On January 10,
2023, the People's Bank of China and the Banking and Insurance Regulatory Commission jointly held a symposium on credit work of major banks to study and deploy the implementation of financial support for steady growth, with emphasis on the real estate market. "Implementing the plan to improve the balance sheet of high-quality housing enterprises, focusing on high-quality housing enterprises with focus on the main business, compliance management, good qualifications and certain systemic importance, and carrying out the four actions of" asset activation "," liability continuation "," equity supplement "and" expected promotion "to guide the balance sheet of high-quality housing enterprises to return to a safe range." The symposium said.
At the same time, the regulatory authorities also said that they should implement 16 policies and measures to support the steady and healthy development of the real estate market, make good use of the bond financing support tools for private enterprises (the "second arrow"), maintain the stability of financing channels such as credit and bonds for real estate enterprises, and meet the reasonable financing needs of the industry.
Analysts said that the meeting was the first credit work conference in 2023, but the meeting still mentioned more about real estate, which shows that real estate is the top priority of financial credit in 2023, reflecting the high-level attention and support for real estate financing. "As far as content is concerned, the biggest highlight of this meeting is that four actions of balance sheet optimization have been put forward, and the work of balance sheet optimization is entering the stage of substantive operation." Yan Yuejin, research director of Shanghai Yi Ju Real Estate Research Institute, said. After the emergence of risks in
real estate enterprises, in the second and third quarters of 2022, supervision has repeatedly emphasized "guaranteed delivery" to promote the normal cycle of finance and real estate, and to do a good job of "guaranteed delivery, people's livelihood and stability" to meet the reasonable financing needs of the real estate market. Since the fourth quarter of
2022, the expression of the balance sheet of real estate enterprises has gradually emerged, and the regulatory authorities have formed a very clear logical line and started to protect the main body of high-quality real estate enterprises. At the Financial Street Forum annual meeting held in November 2022, Yi Huiman, chairman of the China Securities Regulatory Commission, expressed his support for the implementation of the plan to improve the balance sheet of high-quality real estate enterprises. On November 22, the executive meeting of the State Council said that efforts should be made to improve the assets and liabilities of the real estate industry; On December 15, Vice Premier Liu He of the State Council pointed out that new measures were being considered to improve the assets and liabilities of the industry and guide market expectations and confidence to recover. On December 16, the Central Economic Work Conference pointed out that meeting the reasonable financing needs of the industry, effectively preventing and resolving the risks of high-quality head housing enterprises, and improving the assets and liabilities.
In addition, the recent stimulus to the real estate policy not only comes from the financing side, but also on January 10, the Ministry of Housing and Construction said that it would promote the housing provident fund business to be easier to handle, and strive to achieve the same standard of acceptance of housing provident fund nationwide. Recently, Shenzhen has allowed second-hand housing transactions to be "transferred with mortgage" to promote the prosperity of second-hand transactions.
"Protecting the main body and protecting the project is the problem of protecting chickens and eggs.". If the chickens are gone, the eggs alone are not enough, and the good hens should be saved. On January 6, 2023, Feng Yi, General Manager of Zheshang Asset Strategic Development Department and Vice President of Research Institute, said at the Seventh New Financial Forum held by Wangwang Think Tank of Xinhua News Agency.
"In the early stage, the policy emphasized the insurance project, and now it also began to emphasize the main body of insurance, to combine the insurance project with the main body of insurance, to retain better high-quality market players, so as to play the role of market mechanism." Yin Jiangao, party secretary and director of the Shanxi Regulatory Bureau of the China Banking and Insurance Regulatory Commission, said at the above forum.
On January 10, the People's Bank of China and the Banking and Insurance Regulatory Commission jointly held a symposium on credit work of major banks to study, deploy and implement the work related to financial support for steady growth. The meeting proposed four actions of "asset activation", "debt continuation", "equity supplement" and "expected promotion" for high-quality housing enterprises with systemic importance, and comprehensively implemented measures to improve the operating and financing cash flow of high-quality housing enterprises.
These four actions are the core of further stimulating the real estate market on January 10. Among them, asset activation is the key, and financing cash flow can not deviate from operating cash flow for a long time. "The so-called asset activation is actually to promote the recovery of sales.". With weak consumer confidence and low enthusiasm for home ownership, it is necessary for all parties to actively introduce policies to promote the recovery of the real estate market. We expect that mortgage interest rates will continue to decline in the future, and the down payment conditions for first-time and improved home ownership will continue to be optimized. CITIC Securities Research Department said.
Data show that in December 2022, residents'medium and long-term consumer loans increased by more than 180 billion yuan annually, and housing consumer credit has improved significantly compared with the relatively low point in October, but still declined significantly compared with the same period in previous years.
Yan Yuejin said that asset activation also means revitalizing all kinds of assets of real estate enterprises, including land to be developed and real estate to be sold, accelerated return of pre-sale funds, accelerated promotion of asset securitization, accelerated intervention of REITs products and other modes, and continuous improvement of cash flow.
"Debt continuation and equity supplement" is interpreted by the market as avoiding further credit risk of enterprises, thus falling into a vicious circle. The policy recognizes that some housing enterprises are systemically important and cannot allow their short-term assets to ferment into overall risks. Some market participants expect that in the future, financial institutions, especially banks, will be more active in real estate credit, and the refinancing of real estate stocks will continue to be promoted.
Previously, the regulatory authorities issued 16 financial measures to support the reasonable extension of stock financing such as development loans and trust loans: For stock financing such as development loans and trust loans for real estate enterprises, on the premise of guaranteeing the safety of creditor's rights, financial institutions and real estate enterprises are encouraged to negotiate independently on the basis of commercial principles. Actively support the project by extending the stock loan and adjusting the repayment arrangement to promote the completion and delivery of the project.
The "expected improvement" means that investors'views on China's housing enterprises, especially those of various financial institutions, should be constantly restored. "We should constantly reduce the risk of default of enterprises, and at the same time strengthen the target value of sales of real estate enterprises, so as to promote the smooth channels of" finance-real estate-sales market ". Yan Yuejin said.
Demand still exists, but confidence needs to be restored
. Whether the real estate market will usher in a turning point in 2023 has become one of the most concerned issues in the market. Several market participants said that the successful implementation of these recent measures may alleviate the liquidity pressure of housing enterprises to a certain extent, but the overall recovery of new housing sales is still the key to the sustained improvement of liquidity in the real estate market. According to the data
of Kerui Research Center, the cumulative performance scale of the top 100 real estate enterprises in the industry decreased by 42% in November before 2022 compared with the same period last year. "In 2022, China's real estate market as a whole continued the downward pressure since last year, with low industry confidence, insufficient market demand and purchasing power.". Combined with the impact of epidemic factors, there is no obvious sign of warming in market supply and demand and transactions, and the quarterly sales of enterprises are sluggish compared with previous years. The Krei Research Center said.
Fitch Ratings predicts that the operating environment of Chinese-funded housing companies will not improve significantly in 2023-contract sales in the industry may fall by 0-5 percentage points year-on-year. It means that only 11 can be achieved in the whole year.
"Extensive monetary stimulus measures have helped the real estate industry rebound from the bottom of the two crises in 2008-2009 and 2014-2015.". However, the central government's current adherence to the principle of "no speculation in housing" shows that prudent and targeted policies are still the main way to rescue the market. Fitch Ratings said.
In the longer term, many regulators and market participants believe that there are still big opportunities for real estate in China. Feng Yi said that judging from the size of China's population and the degree of urbanization, there is still a lot of room for urbanization, and many people will enter the city in the future. Residents must have houses when they enter the city, and there is still a lot of room for China's real estate market.
"Now we all feel that the real estate industry is not very good, from a practical point of view, China's national conditions are quite different in different places, the structure is also very serious, big cities and cities with good economy are not so bad at present." Feng Yi said.
Yin Jiangao said that according to the latest statistics, the proportion of three-bedroom apartments in newly purchased houses is 55%, and it is still rising year by year. This shows that the rigid demand of residents and the demand for improvement are real.
The People's Bank of China and the Banking and Insurance Regulatory Commission have also mentioned that we should implement differentiated housing credit policies according to the city, better support rigid and improved housing demand, increase financial support for housing rental, do a good job in housing financial services for new citizens and young people, and accelerate the establishment of a "simultaneous rent and purchase" housing system.
However, the overall performance of the market is still weak, and we need to wait patiently for the expected repair and demand side improvement. "In fact, with the strong support of the current policy, some housing enterprises no longer have a big gap in financing, but the confidence of the market downturn affects their sales." Another banker said. Zhou Jiping, general manager
of ICBC's Risk Asset Management Center, said at the Seventh New Financial Forum that in the past year, there have been many policies to support real estate, and the strength has not been great. However, real estate has strong cyclical characteristics, and because of its heavy asset attributes, in order to achieve a more obvious recovery, it will take some time to achieve significant results.
Zhou Jiping said that the favorable policies in various aspects are constantly accumulating, but there are several problems that need to be solved: First, the issue of market confidence needs policy guidance. Second, all kinds of subjects in the market should make good use of these policies flexibly, adhere to the concept of innovation, use innovative tools and paths, and make some attempts to restore the vitality of the real estate market.
"The government will continue to mobilize and strengthen the" guaranteed delivery "of housing enterprises to solve the problem of delivery of futures houses, which will better safeguard the legitimate rights and interests of buyers, boost market sentiment and stabilize the confidence of buyers. Some local governments will relax their real estate regulation policies such as "purchase restriction, loan restriction, price restriction and sale restriction" to promote the consumption demand of just-in-need and improved housing. After fully implementing the optimization measures for epidemic prevention and control, the government will focus on economic and social development in the future, and the national economy is expected to stabilize and rebound. Increasing residents'income, optimizing the distribution pattern and increasing residents' income are the prerequisites for expanding consumption, especially for large-scale consumption such as housing, stable and expected growth income is the basic support for residents to dare to consume. On January 9, Ernst & Young released a report.
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