How much credit support will be given to the major event of 300 million “new citizens” buying a house?
During the two sessions, “new citizens” were hotly discussed again. Although they did not appear in the 2022 National Government Work Report, the importance of the official document issued is self-evident. Recently, the China Banking and Insurance Regulatory Commission and the People’s Bank of China issued the “Notice on Strengthening Financial Services for New Citizens” (referred to as the “Notice”). In terms of housing, which has attracted much attention, the new policy requires that new citizens who meet the requirements of the housing purchase policy, have the ability to purchase houses, and have relatively stable incomes should reasonably meet their housing credit needs.
At present, there are 300 million new citizens in my country, which is a huge number. The housing needs of these people need to be solved urgently. Wang Menghui, Minister of Housing and Urban-Rural Development, once said in an interview with People’s Daily that to solve the outstanding housing problems in big cities, we must pay attention to solving the housing difficulties of this group of people.
Today, the financial sector has specially issued financial support policies related to new citizens. In the opinion of industry insiders, this can effectively reduce the capital cost of home buyers, thereby increasing the enthusiasm of new citizens to buy houses, which is conducive to stimulating the vitality of the real estate market and stabilizing market expectations. The market released a batch of potential housing demand.
Provide financial policy support such as housing supply and credit to new citizens
“New citizens” first appeared in the State Council’s government work report last year. This year, the China Banking and Insurance Regulatory Commission and the Central Bank issued the first comprehensive financial support policy for “new citizens”.
In response to the financial needs of new citizens in key areas such as entrepreneurship, employment, housing, education, medical care, and elderly care, the above-mentioned “Notice” encourages and guides banking and insurance institutions to actively connect with existing support policies, and strengthens products and services according to local conditions. Service innovation, high-quality expansion of financial supply, and enhancement of the equality and convenience of financial services.
In terms of housing financial services, it mainly involves housing supply, rental housing, and credit support for housing purchases. For example, in terms of increasing the supply of affordable housing, the “Notice” encourages banking institutions to increase public rental housing, affordable rental housing, shared property housing and other affordable housing and old urban communities under the premise of compliance with laws and regulations and controllable risks. Support for reconstruction projects; support commercial banks to provide professional and diversified financial services in compliance with laws and regulations in the development and construction of affordable housing, purchase, inventory revitalization, renovation and renovation, operation management, and supporting municipal infrastructure construction.
In terms of housing leasing, the “Notice” supports commercial banks to provide credit support for professional and large-scale housing leasing companies in compliance with laws and regulations, reduce the capital cost of housing leasing companies, and help ease the housing pressure of new citizens.
In terms of meeting the reasonable demand for housing credit for new citizens, the “Notice” clearly supports commercial banks to conscientiously implement relevant national policies, closely focus on the goal of “stabilizing land prices, housing prices, and stabilizing expectations”, and implement differentiated housing credit policies based on city-specific policies. Reasonably determine the mortgage loan standards for the first home of new citizens who meet the housing purchase conditions, and improve the convenience of borrowing and repayment; at the same time, commercial banks are encouraged to make full use of information technology methods, scientifically and prudently assess the credit level of new citizens in multiple dimensions, and make full use of information technology.
New citizens who have the ability to buy houses and have relatively stable incomes can reasonably meet their credit needs for house purchases.
In this regard, Zhai Meiqing, member of the National Committee of the Chinese People’s Political Consultative Conference and president of Heungkong Group, said in an interview with a reporter from the Beijing News that there is still a lot of room for urbanization in my country, especially the urbanization of the registered population, and the current housing needs of Chinese residents, especially “new citizens” housing demand is still relatively strong.
The housing problem of a considerable number of new citizens has not been resolved, and many urban residents have new expectations for improving housing conditions. Meeting the housing needs of new citizens is not only an important starting point for the real estate market to make progress while maintaining stability, but also an inevitable requirement to improve the quality of the country’s new urbanization construction.
The number of new citizens has reached 300 million, and the contradiction between housing in big cities is prominent
“New citizens” is not a new term, it first appeared around 2014, referring to migrant workers who have lived in cities for a long time and have relatively regular jobs.
In July 2014, Premier Li Keqiang of the State Council held an executive meeting of the State Council and pointed out that for migrant workers who live in cities for a long time and have relatively regular jobs, they should gradually be integrated into urban “new citizens” and enjoy the same basic public services. They are considered “second-class citizens” of the city.
With the acceleration of urbanization and the influx of talents into big cities, the scope of new citizens has gradually expanded. The “National Housing Provident Fund Annual Report 2017” mentioned new citizens, in addition to agricultural transfer population, it also includes “new employment” College Students”.
In 2021, “new citizens” appeared for the first time in the State Council’s “Government Work Report”, and it was clear that they would “do their best to help new citizens and young people ease housing difficulties.”
What exactly is a “new citizen”? Guo Shuqing, chairman of the China Banking and Insurance Regulatory Commission, mentioned at a press conference of the State Council Information Office a few days ago that the so-called “new citizens” are people who have already lived in cities but do not have a registered permanent residence, or who have just obtained a registered permanent residence for less than two or three years.
The “Notice” also clarifies the concept of “new citizens”, which mainly refers to various groups who have come to live in cities and towns for reasons such as starting their own businesses, going to school, and relying on their children, but have not obtained local household registration or have obtained local household registration for less than three years. Including but not limited to migrant workers, newly employed college graduates, etc.
How big is this population? Guo Shuqing revealed that there are more than 300 million people, and they are all facing the needs of living and working in peace and contentment, employment and entrepreneurship, renting and buying a house, children going to school, and elderly care for the elderly, all of which are very real.
With the advancement of new urbanization, more and more people flow to central areas, big cities, core cities, etc. Compared with the original residents and those who settled earlier, new citizens face prominent contradictions, including living in , education, medical care, etc. For example, there is a big gap between the income of some new citizens and the high housing prices in big cities, the ability to pay for housing is limited, and the rental market is facing problems such as rising rents and imbalances in the supply and demand structure.
The new policy is a comprehensive financial support policy for new citizens, involving employment, housing, education, medical care, pension and other aspects. Especially in terms of housing financial support, it covers housing supply, rental housing and housing credit, especially housing credit. If the loan interest rate is reduced, it will effectively reduce the cost of housing purchases for new citizens.
Chen Wenjing, market research director of the Index Division of the China Index Research Institute, said that by providing credit support for new citizens to buy houses, it will help reduce their pressure on buying houses, thereby helping to solve the housing problems of new citizens. In addition, 300 million new citizens mean that there is a large group of potential home buyers, and the implementation of this policy is conducive to stimulating potential and reasonable demand for home purchases.
Especially at the moment, under the background of directional easing of relevant policies, the credit support for the purchase of new citizens will undoubtedly enhance the expectations of the real estate market. “This is conducive to lowering the threshold and capital cost of homebuyers, thereby increasing the enthusiasm of new citizens to buy houses, stimulating the vitality of the real estate market, stabilizing market expectations, releasing a batch of potential home purchase demand for the current market, and further promoting the stable development of the real estate market. Demand. The continuous development of the end-to-end policy is conducive to breaking the current real estate deadlock.” Chen Wenjing said.
Zhai Meiqing also believes that if the potential purchase demand of new citizens is reasonably released, it is expected to activate the willingness to trade in the market and improve the sluggish fundamentals of real estate through just-needed underlying support and improved gradient replacement.
Industry: Credit support can refer to the principle of “risk from low to high”
What is worth paying attention to is how to meet their housing loan needs, and how to better implement policies according to the city at the practical level, given the large number of new citizens and their different situations?
Chen Wenjing believes that the direction of policy adjustment may be based on lowering the threshold and cost of buying a house for new citizens, so that everyone has the ability and willingness to buy a house. In response to the demand for the first housing of new citizens, we can start by reducing the ratio of down payment for the first housing, lowering the loan interest rate, and flexibly withdrawing the provident fund; for improving the demand, we may appropriately adjust the identification standards for the second set, reducing the ratio of down payment and loan interest rate, etc. Get started.
Xu Xiaole, chief market analyst of the Shell Research Institute, said that the “Notice” should “reasonably determine the standards for mortgage loans for the first housing of new citizens who meet the housing conditions”, emphasizing the need to “meet the housing conditions”, which means that the standards for the purchase conditions of each city are as follows: prerequisite basis.
Large first-tier cities have implemented relatively strict purchase restrictions, and there is little possibility of relaxation; some cities with insufficient market demand may relax purchase restrictions, such as moderately relaxing social security or household registration restrictions, and eligible “new citizens” can receive credit support. City market transactions may pick up.
Xu Xiaole also believes that from the perspective of preventing financial risks, housing credit should firmly grasp the bottom line of macro prudence, strictly follow regulatory requirements such as income certification standards and sources of down payment funds, and prevent “loopholes” for arbitrage; in terms of methods, it can be reduced from loan interest rates. , to extend the loan period, carefully reduce the down payment ratio, or consider accurately profiling the new citizen group according to the principle of “risk from low to high”.
Beijing Real Estate Information