Core view: the policy comes as scheduled, the market is still depressed and still optimistic about the real estate sector
From March 2022 to now, more than 40 cities have gradually relaxed the policy regulation of the real estate market, but the fundamentals are still difficult to improve. The recovery of industry sales is facing the dual test of residents’ purchase “will” and purchase “ability”, and the investment side needs to solve the problem of the decline of the overall investment ability of the industry. At present, the effect of the real estate support policy is still insufficient. Under the repeated epidemic, the pressure of economic recovery has increased sharply. The central bank’s RRR reduction on schedule or just the beginning of the introduction of a new round of economic underpinning policy portfolio, the follow-up policy is still optimistic, the real estate sector still has good investment opportunities and maintains the optimistic rating of the industry.
Policy side: the central bank announced a comprehensive RRR reduction and more underground mortgage interest rates
At the central level: the central bank decided to reduce the deposit reserve ratio of financial institutions by 0.25 percentage points on April 25, 2022, releasing a total of about 530 billion yuan of long-term funds; At the same time, he emphasized the flexible use of a variety of monetary policy tools to maintain the stability of the financial system. The CSRC, the SASAC and the all China Federation of industry and Commerce issued a document to strictly prevent and properly resolve various risks and promote the virtuous circle and healthy development of the real estate industry. At the local level: with the continuous promotion of “implementing policies based on cities” in various regions, Guangzhou, Hubei, Hebei and Shandong have lowered the loan interest rates of the first and second homes, Suzhou, Wuhu and Nanjing Liuhe Lishui district have relaxed the purchase or sale restriction policies, Nanning has issued corresponding purchase deed and tax subsidies for different buyers, Shanghai Lingang Holdings Co.Ltd(600848) new area has optimized the talent purchase policy, and Gansu has implemented the reform of “delivery of houses and certificates” for new commercial houses.
Market side: the turnover in a single week continued to decline year-on-year, and the turnover in the land market remained depressed
Sales side: in the 15th week of 2022, the transaction area of 30 large and medium-sized cities in China was 1.46 million square meters, a year-on-year decrease of 66% and a month on month decrease of 4%; From the cumulative value, the transaction area of 30 large and medium-sized cities has reached 32.49 million square meters since the beginning of the year, with a cumulative year-on-year decrease of 40%; Since the beginning of the year, the transaction area of new houses in 30 large and medium-sized cities in China has increased by – 40%. The trend of each line of cities is basically the same. The year-on-year growth rate of transactions of the first, second and third lines in a single week is – 71%, – 64% and – 64% respectively, and the cumulative growth rate since the beginning of the year is – 36%, – 35% and – 51%.
Land side: in the 15th week of 2022, 100 large and medium-sized cities across the country launched a planned land construction area of 11.31 million square meters, with a planned land construction area of 8.24 million square meters, a year-on-year decrease of 71% and a transaction premium rate of 0.2%. Planned construction area of no land in first tier cities; The planned construction area of land traded in second tier cities was 3.83 million square meters, a year-on-year decrease of 44%; The planned construction area of land traded in the third tier cities was 4.42 million square meters, a year-on-year decrease of 79%. Changsha completed the first batch of centralized land auction in 2022. All 22 plots were sold, 19 were sold at the base price and 3 were sold at a premium. A total of 56 real estate enterprises participated in the land auction, and national developers such as China Resources, China Merchants, Jindi, Xuhui and China shipping and local state-owned enterprises gained.
Financing side: the scale of China’s credit bonds continued to shrink, and the interest rate of overseas bonds rose
In the 15th week of 2022, credit bonds issued 5.19 billion yuan, a year-on-year decrease of 66%, a month on month increase of 284%, an average weighted interest rate of 3.09%, and a month on month decrease of 55bps; The issuance of overseas bonds was US $490 million, a year-on-year decrease of 51%, a month on month decrease of 49%, an average weighted interest rate of 10%, and a month on month increase of 194bps.
Risk tips: (1) the recovery of industry sales is less than expected, the improvement of financing is less than expected, and the capital risk of real estate enterprises is further increased; (2) Regulatory policies have changed more than expected, and industry fluctuations have intensified.
