Recently, the Information Office of the State Council held a press conference to promote a virtuous cycle of economy and finance and high-quality development. Tian Guoli, chairman of China China Construction Bank Corporation(601939) board of directors, said at the meeting that the era of appreciation in buying houses has passed. With the maturity of China’s market, the era of relying on leasing will soon come.
From “to buy a house to CCB” to “to rent a house to CCB”; From “simultaneous development of rent and purchase” to accelerating the development of long-term rental housing market; From financial institutions to real estate enterprises, from buyers to renters, all stakeholders in the real estate industry are ushering in a profound ideological change and baptism.
local auction precooling sales downward stakeholders rush to things
On January 17, the official website of the National Bureau of Statistics announced the completion of national real estate development investment in 2021, the sales and sale of commercial houses and the funds in place of real estate development enterprises. The data show that in 2021, the national real estate development investment increased by 4.4% year-on-year; China’s commercial housing sales reached 18.193 trillion yuan, a year-on-year increase of 4.8%.
In fact, according to the single month data, from March 2021, the sales volume and sales area of commercial housing have changed from rise to fall, and have shown a downward trend for 10 consecutive months until December. Among them, from January to February 2021, the development investment increased by 38.3% year-on-year.
The decline in sales and sales area has also affected the local auction enthusiasm of real estate enterprises. In 2021, the land acquisition area of real estate development enterprises was 215.9 million square meters, a decrease of 15.5% over the previous year; The land transaction price was 1775.6 billion yuan, an increase of 2.8% over the previous year.
Specifically, the three rounds of centralized land supply in many cities in 2021 show a situation of ice and fire. On the one hand, in the first round of centralized land supply in 2021, the average land premium rate of Chongqing, Hangzhou, Xiamen, Shenzhen and other cities exceeded 20%, of which the overall premium rate of Chongqing reached 43%, ranking first among the 22 cities of centralized land supply. On the other hand, only five months later, the market heat of the second round of land supply land auction dropped sharply, and the base price transaction became the norm. The average premium rate of 22 cities was only 4%, of which more than 80% of the cities had a significant decrease compared with the first round. Among them, the highest premium rate in Chongqing was only 0.43%, and the overall premium rate was only 0.02%. A large number of land flow standards or base price transactions in the land auction. In the third round of centralized land supply, although some conditions are “moderately relaxed” and many cities have lowered the threshold of land auction to varying degrees, the overall premium rate of the land market is relatively low and the competition is not fierce.
Due to the precooling of local auction and the decline of sales, and the superposition of complex internal and external development environment, all stakeholders in the real estate industry began to go against each other.
Since 2021, major banks have tightened real estate loans and adjusted housing loan policies. More and more real estate buyers are difficult to obtain housing loans from banks, which has a great impact on real estate sales, payment collection and second-hand housing market. Some real estate enterprises are in a cash flow crisis and fall into a liquidity crisis.
With the pre cooling of transactions in the real estate market and the prominent role of real estate regulation policies, the rising trend of house prices has been curbed, house prices in some cities have begun to decline slowly, the wait-and-see mood of potential buyers has become stronger, and the enthusiasm and urgency of house purchase have decreased significantly, which has exacerbated the difficulty of de inventory of real estate.
Limited by the influence of real estate regulation policy, bank loan policy adjustment and the increasing wait-and-see mood of buyers, the pressure of real estate enterprise development and decontamination has increased sharply, the pressure of payment collection and debt repayment has become prominent, and the promotion and discount sales of real estate enterprises have become the norm, which has further affected the prosperity of the local auction market and the follow-up development of real estate.
Under the influence of various factors, the development direction of the real estate industry has gradually shifted. The once criticized high turnover model is becoming a thing of the past, and the new momentum of the real estate industry and real estate enterprises is constantly nurturing and maturing.
advanced layout advantages highlight the real estate industry to cultivate new driving forces
With the deepening of urban development, the new housing market space is becoming smaller and smaller, and the stock housing will become the main source of supply in the residential field. In recent years, under the influence of various factors, more and more real estate enterprises have set foot in real estate operation, long-term rental apartments and other fields.
In June 2014, the people’s daily reprinted the article “the property market has entered the silver age” by Yu Liang, President of Vanke Group, which triggered a heated debate in the industry. In the same year, Vanke took the lead in testing the field of long-term rental apartments. In November 2014, Vanke officially entered the field of rental housing and took over the first project poyu Wanhui building in the same month. In 2015, Vanke established a separate rental apartment business department to develop long-term rental apartments and began to try in several key cities. In 2016, Vanke integrated the long-term rental apartment projects of its branches and made a unified management platform to coordinate project development, operation management, price approval and financial settlement, and unified it as the “Park apartment” brand.
The official account of WeChat public in February 23rd was released in the 2021 annual growth report. According to the data, Vanke’s youth apartment brand “Boyu” has been distributed in 33 cities across the country, managed more than 400 stores, and opened more than 160000 houses, with an average rental rate of 95%. It has provided asset management services for 2944 asset parties, becoming the largest centralized long-term rental apartment brand in China.
In addition to Vanke, in March 2017, Guanyu, a subsidiary of Longhu, took substantial steps and landed in Chengdu Jinnan Tianjie store and Shidai Tianjie store for the first time. As of the end of 2029, the rental rate of more than 300000 houses in Longhu and other cities in China, including Shenzhen and Shanghai, has reached 94.5% in the first six months of 2029, with a long-term rental rate of more than 1.5%.
In addition, poly, COSCO, Greentown, Yango Group Co.Ltd(000671) , Jindi, Xuhui, Yuexiu, Zhongjun, Shangkun, Fangyuan, Nacity Property Service Group Co.Ltd(603506) and other real estate enterprises and property companies have also arranged long-term rental apartments. However, compared with the pioneers of long-term rental apartments and the leading brands in the industry, the scale and business layout of rising stars are relatively limited, and the influence and number of houses are also slightly insufficient.
In addition to long-term rental apartments, real estate enterprises have also frequently settled in the fields of commercial operation, property management, cultural tourism, pension and so on. However, in addition to a few fields such as property management, commercial transportation management and long-term rental apartments, which have explored more mature business models and achieved profits, most fields are still in the stage of continuous investment or loss. In the long run, only with sufficient talent reserves, strong financial support and rich experience in relevant fields, can real estate enterprises benefit from diversification.
In the process of policy guidance and market evolution, long rent apartments are gradually coming to the fore. However, due to the inherent characteristics of heavy asset operation, long return cycle and high dependence on location factors, the rent of long-term rental apartments of brand real estate enterprises remains high for a long time. Small and medium-sized enterprises are also difficult to invest continuously due to lack of capital sources, and the competition in the long-term rental housing market is not sufficient. In addition, the problems of single exit channel, different rental and purchase rights and limited supply also continue to perplex and affect the nerves of all participants in the long-term rental housing market.
left hand policy and right hand capital rental and purchase usher in new opportunities
On July 2, 2021, the State Council issued the opinions on accelerating the development of affordable rental housing, which defined the top-level design of the housing security system for the first time at the national level, reflecting the state’s attention to affordable rental housing.
The 2022 government work report pointed out that we should accelerate the development of the long-term rental housing market. Prior to this, on February 8, the central bank and the China Banking and Insurance Regulatory Commission issued the notice on the exclusion of affordable rental housing related loans from the concentration management of real estate loans, and on February 27, the China Banking and Insurance Regulatory Commission and the Ministry of housing and urban rural development jointly issued the guidance on bank insurance institutions supporting the development of affordable rental housing market, Further strengthen financial support for the construction and operation of indemnificatory rental housing.
What is more noteworthy is that on June 21, 2021, the first batch of nine infrastructure public offering REITs pilot projects were successfully listed, raising a total of 31.4 billion yuan. The projects cover a variety of asset types such as industrial parks, highways, warehousing and logistics, sewage treatment, etc. the funds raised are mainly used in the fields of scientific and technological innovation, green development, people’s livelihood and other areas. Since the launch of the products, the overall operation has been stable, in line with the pilot expectations and made a good start. The successful implementation of the pilot project marks a key step in the construction of China’s public offering REITs market.
This is also a key step in the market construction of REITs products since the executive meeting of the State Council in December 2008 studied and determined nine policies and measures for finance to promote economic development and clarified the nature of real estate trust and investment funds (REITs) as an innovative financing method. This also means that real estate enterprises are ushering in new opportunities to transform real estate operations and vigorously develop long-term rental products.
In addition, the entry of large state-owned commercial banks has also injected new impetus into the standardized development of the leasing market.
Public information shows that relying on the technical advantages of the “new generation” core system accumulated over the years, China Construction Bank Corporation(601939) strive to build a housing rental service platform system. With the joint cooperation of the head office, branches and sub branches, China Construction Bank Corporation(601939) took the lead in building a housing lease supervision and transaction service platform that can accurately match the needs of local governments and market supervision and operation. Based on the three positioning of “full platform support, full chain service and full product support”, the platform will provide comprehensive solutions for the housing rental market in pilot cities.
It is reported that the platform has strong openness and sharing, and supports the opening of functions and interfaces of the government, landlords, tenants, brokers, leasing enterprises, urban operations, platform operations, banks and other regulators and all transaction service subjects. In order to ensure the authenticity of the houses provided by the platform, the enterprise houses are jointly operated by China Construction Bank Corporation(601939) and well-known brand apartment rental enterprises, and all house information is released after verification; The information of individual landlords’ houses can only be released after online verification, on-site verification and background audit.
Helping to promote the implementation of the policy of simultaneous rent and purchase, China Construction Bank Corporation(601939) not only devotes itself to being the promoter and builder of the market, but also pays attention to the guidance and cultivation of long-term rent culture, and actively advocates the new housing concept of “house is for living, rent is good”, “long-term rent is for living, long-term living is for settling down”, so as to make renting a new choice to enjoy a better life. In order to promote this concept, China Construction Bank Corporation(601939) strive to build a “CCB Jianrong home” brand community, build a housing rental financial center, and set up a special subsidiary to be responsible for rental management and batch community branding management, so as to ensure the stable and long-term rental of houses, improve the quality of houses and improve the happiness index of tenants.
At the just concluded two sessions of the National People’s Congress, a number of Representatives and members focused on the real estate field and put forward suggestions and proposals, mainly focusing on the pre-sale system, rental and purchase rights, green and low-carbon buildings, etc. Yao Jinbo, deputy to the National People’s Congress and 58 city CEO, said that it is necessary to ensure that buyers and renters enjoy the same rights and gradually promote the equalization of basic public services for leasing. In addition, set up a professional and efficient rental court and design a diversified dispute resolution mechanism to deal with rental disputes. Mo Tianquan, member of the CPPCC National Committee and founder of the real estate world, also suggested that we should vigorously develop the housing rental market, especially affordable rental housing, promote the right of rental residents to enjoy public services and relieve the worries of rental groups.
With the promotion, implementation and implementation of various favorable policies such as financing, taxation and the same right of rent and purchase, as well as the continuous construction of indemnificatory rental housing and the gradual entry of long-term rental apartments into the stage of refined operation, under the influence of the solemn commitment of “let all people live”, rent and purchase merger is ushering in new development opportunities.
