[Epoch Times November 14, 2021](The Epoch Times reporter Li Linqing interviewed and reported) Recently, people from all walks of life are concerned about the Beijing authorities’ consideration of relaxing the real estate policy, including the possible relaxation of allowing state-owned enterprises to take over without increasing the debt ratio. Private enterprise. The analysis believes that this is another sign that the Xi authorities have adopted the “national advancement and national retreat” in response to a possible hard landing in the real estate industry.
The State Council of the Communist Party of China recently held talks with representatives of real estate companies, including the State Council Development Research Center of the Communist Party of China held a symposium with Vanke, Kaisa, Ping An, CITIC and China Construction Bank and China Railway Trust in Shenzhen on November 8. The association held seminars with companies such as China Merchants Shekou, Poly Development, Country Garden, Longfor Group, Jiayuan Chuangsheng, and Midea Real Estate.
Some bond practitioners believe that the above-mentioned conference releases information that is beneficial to real estate companies, and that real estate companies’ domestic bond issuance policies will be loosened. Banks and other institutions will re-transfuse real estate companies through bond investment and other methods to prevent real estate companies. The capital chain further deteriorated.
On November 12, the stocks of companies such as China Merchants Shekou and Poly began to rise, and a batch of real estate bonds rose by more than double digits.
Relax regulation?Xi’s policy “fixed force” is challenged
On the 12th, the China Banking and Insurance Regulatory Commission held a party committee meeting to convey and study the spirit of the Sixth Plenary Session of the 19th Central Committee and Xi Jinping’s speech, requiring agencies at all levels to stabilize land prices, property prices, and expectations, curb the financial bubble tendency of the property market, and prevent financial risks.
Current political commentator Wang He told The Epoch Times on the 12th that the real estate situation is relatively bad, and the CPC Central Committee’s policy on financing for real estate enterprises may be relaxed. “Some tactical adjustments will be made. The tone will not change and the degree of relaxation will not be very Big.”
Although the mainland financial regulators continued to voice in October, emphasizing that credit is not to be overcorrected, the amount of financing in the real estate industry continued to decline sharply in October. The data released by the Zhongzhi Research Institute on November 9 showed that the monthly financing rate of real estate enterprises in October fell to 2021. The highest since that month, the total financing of real estate enterprises was 36.5 billion yuan (RMB, the same below), a year-on-year decrease of 74.8% and a month-on-month decrease of 60%.
There has been an increase in personal housing loans. On November 10, the People’s Bank of China released data showing that at the end of October 2021, the balance of personal housing loans was 37.7 trillion yuan, an increase of 348.1 billion yuan that month, an increase of 101.3 billion yuan from September.
The Chinese Communist Party’s official media Economic Daily issued a statement on the 12th that the increase in personal housing loans in October was a callback to the previous excessive tightening of credit, and it does not need to be interpreted as “relaxed regulation” or even “credibility” speculation. The article emphasizes that the determination of real estate policy will not be relaxed.
Wang He analyzed, “Now it is a test of the so-called real estate policy of the Xi authorities. Whether the high-pressure policy will be relaxed depends on the authorities’ judgment on China’s economic trends. If the economy is stable, it may not be relaxed. If the economy experiences a cliff-like decline. , The policy may be abandoned.”
State-owned banks dare not lend money to the downturn in the industry
According to a recent report by Caixin.com, the president of a bank in Guangzhou said that many financial institutions are afraid to lend to the real estate industry. The most important reason is that the real estate industry is already in a period of obvious downturn. In order to protect itself, financial institutions will inevitably reduce the amount of money provided to the real estate industry. Corporate lending. Some banks have even begun to “draw loans” to private housing companies with higher risks.
A middle-level cadre of a large state-owned bank said bluntly: “A considerable number of banks now only dare to lend to some state-owned enterprises. The risk of lending to private enterprises is too great. I don’t know which real estate company will fall tomorrow.”
Mainland private financial investor Chen Ling (pseudonym) told The Epoch Times on November 12: “Now private real estate companies are getting more and more difficult, and the possibility of getting resources from banks is getting less and less. In addition, real estate tax will be introduced. Development) has come to an end.”
He believes that China’s current economic situation is not good and the CCP’s series of wrongdoings have caused it to be isolated internationally and its foreign trade has entered a difficult situation. Reach out to the real estate company.
Wang He pointed out that since the CCP’s economy will not change from virtual to real and real estate, if there is no relevant policy document issued, financial institutions will remain cautious in lending and financing real estate companies, and private real estate companies will be even more cautious if they want to get help. Slim.
He said, “Unless the central government has policies and documents in black and white, banks will lend to private enterprises. If problems arise in the future, the banks have a basis for shirking their responsibilities.”
Another sign that real estate is moving towards a public-owned country and the people are retreating
The Cailian Press quoted people familiar with the matter as revealing that for real estate acquisitions and acquisitions, some state-owned enterprises and state-owned enterprises have recently reported to the regulatory authorities that if some debt-based acquisitions are to be undertaken, the “three red lines” will be broken. Be adjusted.
At a symposium on housing companies and financial institutions convened by the Development Research Center of the State Council, the housing company Kaisa stated that its cash flow is very tight and “calls on state-owned enterprises to acquire projects or introduce them as strategic investors to assist private enterprises in supplementing their cash flow.”
Wang He emphasized that under the banner of common prosperity, the authorities used the “three red lines” to squeeze the real estate bubble. The purpose is to squeeze the high leverage behavior of private enterprises and private enterprises, and at the same time, promote the full expansion of public ownership.
He said that in the past nine tenths of China’s real estate were commercial housing and one tenth was social security housing. Now the CCP proposes to build social security housing on a large scale. State-owned enterprises and state-owned enterprises have built a large number of public rental housing, low-rent housing, and economic housing and other public property housing listed on the market.
“It is estimated that private real estate enterprises will still be subject to many restrictions, and the development space is limited. Central enterprises and state-owned enterprises continue to grow stronger, and then occupy the leading position of China’s real estate industry, realizing the country’s advancement and the people’s retreat.” Wang He said.
Chen Ling told The Epoch Times that in order to avoid bankruptcy, private enterprises accept mergers and acquisitions by central enterprises and state-owned enterprises, “it is a feasible way to minimize losses, and there is no way to lose money.” But he believes that economic vitality still depends on private enterprises. State-owned enterprises and central enterprises themselves are also inefficient financial black holes.
Eliminate the real estate bubble or maintain the bubble?
The Wall Street Journal recently quoted people familiar with the matter as saying that the People’s Bank of China is considering opening up a new way for capital-strapped real estate companies to dispose of projects, allowing buyers such as state-owned enterprises to carry out assets under the condition that the debts of the projects being taken over do not affect their own debt ratios. Mergers and acquisitions.
Cai Jinqiang, President and Investment Director of Olu Capital, told the media that state advancement and retreat are obvious policy goals in recent years. The government wants to reshape the real estate structure, focus on state-owned enterprises, and develop with low gross profit and low leverage to prevent bubble risks.
Zhang Tianliang, a commentator on current affairs in the United States, commented that the CCP’s recent release of possible easing of housing market policies and positive news shows that real estate is deeply tied to the CCP’s fate. “The CCP does not want to perish the party. Disruption is very closely related to the collapse of the CCP.”
Editor in charge: Sun Yun
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