Worries about the negative chain effect of the real estate market
[Epoch Times October 02, 2021](Epoch Times reporter Liu Yi comprehensive report) Many cities in mainland China have recently lowered their mortgage interest rates, and the news has been on Baidu’s hot search list. Some analysts believe that the authorities are afraid that more real estate companies will have problems with the capital chain, which will jeopardize the stability of the financial market, and relax mortgages to allow the public to take over for real estate companies.
According to a news from brokerage China on October 1, some large state-owned banks and joint-stock banks in Guangzhou, Foshan and other places have recently lowered their mortgage interest rates.
In Guangzhou, the current mortgage interest rates of Bank of China, Agricultural Bank of China, Bank of Guangzhou, China Merchants Bank, and Everbright Bank have fallen compared with the past. Among them, the interest rate of the first home of Everbright Bank has dropped to 5.60%, a decrease of 40 BP (basis point); The interest rate for the first home has been reduced to 5.45%, and the interest rate for the second home has been reduced to 5.65%.
In Foshan, among the eight local mainstream banks, the housing loan interest rates of China Construction Bank and Agricultural Bank have been lowered, and the first and second houses of Agricultural Bank have fallen more, both of which are 20BP. However, three of the mainstream banks maintained their mortgage interest rates unchanged, and two banks raised them.
In the first eight months of this year, many banks in Guangzhou raised mortgage interest rates five times, becoming the city with the highest loan interest rate among the first-tier cities.
While some bank mortgage interest rates have been cut, bank mortgage time has also been shortened.
A real estate intermediary told Lu Media that in Guangzhou, “recently, some banks have accelerated their lending to customers who bought first-hand houses, and the loans were released within two months.”
Before that, loans for both new and second-hand houses were tightened, and many banks even stopped lending for second-hand houses.
In this regard, Li Yujia, chief researcher of the Guangdong Housing Policy Research Center, said, “At present, the mortgage interest rate in Guangzhou has begun to decline, which is a signal. Therefore, for hot cities, the magnitude of the decline in the fourth quarter may be narrowed and slowed. “
The Monetary Policy Committee of the Central Bank of the Communist Party of China held a regular meeting for the third quarter of 2021 on September 27. Real estate was rarely mentioned at the meeting; on the 29th, the Central Bank of the Communist Party of China and the China Banking and Insurance Regulatory Commission jointly held a real estate finance work seminar. Responsible persons and persons in charge of 24 major banks in mainland China attended the meeting. At both meetings, it was proposed to maintain the “stableness” of the real estate market.
In this regard, Yan Yuejin, research director of the Think Tank Center of E-House Research Institute, believes that recent housing companies have more debt problems, and the real estate may be unfinished. It is necessary to ensure the timely delivery of housing.
Commentator Wen Xiaogang told The Epoch Times that the two “maintenances” proposed by the Chinese Communist Party are related to the mainland real estate shock caused by the current Evergrande Group crisis. Mainland real estate companies have basically developed by relying on high borrowings. They have accumulated a large amount of debt while developing. If they roll slowly, real estate companies may reach a normal cycle in the future. However, the Chinese Communist Party used the “three red lines” last year to cut off some parts. The financing of real estate companies has restricted the financing of real estate companies. The old path of real estate companies borrowing the new to repay the old has been cut off. The capital chain of many real estate companies has been broken, and the debt risk has been exposed. Evergrande is a typical example, because Evergrande is the second leading enterprise in mainland China. The break of its capital chain will have a great impact on the real estate industry, which will cause the financial industry to tighten the real estate bank, and those high-debt real estate companies may burst into thunder. , It may lead to a hard landing of mainland real estate. At the same time, Evergrande’s funding break has caused many projects to be unfinished. Those owners who have paid but have not received the house will take to the streets to defend their rights. This is a great “unstable” factor for the CCP. . Now that the CCP relaxes housing loans, it is also helping real estate companies return funds to repay their debts to avoid a crisis similar to Evergrande. The authorities are also afraid that more real estate companies will have problems with their capital chains and crise financial market stability.
Wen Xiaogang believes that the “three red lines” imposed by the Chinese Communist Party last year to force real estate companies to reduce leverage were too arrogant and ignorant. They underestimated the risks of real estate. The authorities thought that they could do whatever they wanted by relying on administrative orders to achieve their desired goals. As a result, the market used Evergrande to give a severe lesson to the CCP.
Shi Huawei, a former financial planner at the Guangzhou Bank of Communications, believes that the current quarterly monetary policy meetings are now raising real estate issues because the real estate crisis has already burned eyebrows.
Li Yujia also said that the current implementation of real estate financial regulation does not mean tightening of real estate finance, but the pursuit of dynamic stability. At present, there is no room for further tightening of real estate finance.
Many mainland netizens are still very concerned about the mainland property market.
The netizen “Oh, XLFFSy” said: “I just can’t afford it, but I am excited about real estate speculation.”
Shanghai netizen “79Paradise” joked: “Tighten and loosen, loosen and tighten. In short, a big drop is impossible.”
“Auspicious in” said: “I am self-hypnotizing again. How can I relax? Just look at the financing channels and costs of developers. If you don’t have the ability to buy, you still don’t have the ability to buy at a lower interest rate. A 30% discount on the house price can promote buying. .”
Guangdong netizens “rest after suffering” said: “One billion people live in more than four billion suites. There are no houses to live in, and some people do not live in. The property prices are surprisingly high.”
Editor in charge: Li Qiong
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