The regulation of real estate insanity

 In 2006, lower prices for many consumers looking forward to, no doubt, very disappointing year. This year, price gains across the country staggering, causing the people hate, the Prime Minister worried. However, successive introduction of the kinds of macro-control policies, see the result is more control the more crazy house scene! According to National Bureau of Statistics released on November 17 report, January to October this year, China invested 1.4611 trillion yuan in real estate development, an increase of 24.1% over the same period of last year, 2.5 percentage points. At the same time, many major cities housing prices also continued to rise. National Development and Reform Commission recently issued Oct. 70 cities nationwide housing report showed that The city's housing sales price rose 0.4% in September compared to October last year, rose 5.4%, or slightly mm also appeared in real estate situation is pushed to the central government an infinite embarrassment!
Chinese real estate macro-control, the earliest dating back to 1992, Deng Xiaoping's CPC Central Committee and State Council in June 1993 introduced the heat. As domestic demand for housing was provided mainly by the welfare housing units to meet the real estate speculation is still in a pretty much the same, macro-hot moment of the real estate bubble was thus wiped out, the real estate industry has entered a number of researchers and developers to to the unfinished building still bears witness to the real estate market a decade ago that the disaster.
turning point for real estate development in second half of 1998. July 3 this year, the State Council issued a document from the date of the housing reform, housing construction and consumption of the notice , began to support real estate development, the first clear signal. As a result, a new round of bull market officially started in real estate.
stop welfare housing after 1998 most of the young people to work down the housing purchase The first line of Urbanization of cities in the context of a large number of new To improve the housing conditions of the residents re-enter the housing market mm which can be called far enough to pull the real estate market booming. and bank credit will be enlarged housing needs of the 1998 National banks to issue loans 42.6 billion yuan in 2005, amounted to 4.91 trillion yuan mortgage, 7 years, soared 115 times. but only to the first half of 2006, the country's total loans reached up to 3.4 trillion yuan. These data shows that since 1998 China's real estate investment and rapid growth of market demand is basically built on the basis of domestic bank loans.
in our reality, to fish in stealth involved, behavior, but also contributed to a number of similar houses do not sell cases, random, self-inflated house prices, then get the price of housing by 80% of total bank loans; many banks who are also involved in the spontaneous development companies complement each other and even with buyers are always told that housing has been largely sold out, and the price is periodically raised, and which to some extent, the group intensified the psychological panic buyers. And developers can use this consumer credit Housing has become a universal norm. people have a saying that more than half of the country with the county party secretary of housing in Beijing, and Hebei Province Gyeonggi province near the top leaders of more than half of the township with housing officials in Beijing mm This is, perhaps we often Some see the present in more than 40% of residential area the those who purchase or store room, there are some claiming housing The ; investors Safe Community within the office premises and commercial real estate properties began to be favorable for foreign investors, while high-end housing, villas and other projects and the property has also become the target of speculative foreign capital. At present, Morgan Stanley, Goldman Sachs, Macquarie Bank, Merrill Lynch , ING, and many foreign institutions have been deeply involved in domestic real estate market, but also outside the domestic real estate fund shares listed overseas companies are stepping up. As the current policy is not clearly defined for the purpose of FDI and speculative hot money in the differences between , the policy of restrictions on foreign property speculation on the strength of foreign capital has little effect, since 2006, accelerating to enter the Chinese real estate market, and access to the increasingly diverse ways. foreign real estate on a role in fueling the housing boom, has become China significant economic harm, it gets a huge benefit, but its entire economy into the cause of the crisis, may be even more profound.
the current policy, or lack of housing, consumer goods, investment goods is a basic property of the identified housing the authenticity of the requirements are hidden in a large scale among the speculative demand. To our surprise, neither the government or occupy the mainstream of economists, mainly regarded such needs as by the speculation of a continuous, large, long-lasting authenticity needs. , it is difficult to say what is selling price bubble. These requirements can be even more credit support to the CBRC, we can see what the current policy is in a blind state. make an analogy, if the demand for the vegetables into the needs of business and consumer demand and whether there needs to enlarge suspect? and business needs so much investment demand, as it is a supply! real estate and vegetable products of different properties in its permanent, but if the government can clearly define the housing for the consumer, but the for the production of defined as housing operating investment goods, the government thought to be more clear.
from April 2003 of 121 documents, the central regulation of real estate there is no interruption, but the focus of the basic regulation restrictions on land supply and housing units such specific control, or even turn into the former local government and real estate developers an excuse to bid up land prices, resulting in more control the more land and house prices high, almost completely out of control state; and for the regulation of demand in the swing is basically the consumer loans, housing units, double rise in the price pattern will not pose any obstacle to the speculators; although the country introduced a collection of real estate sales tax, personal income tax and land tax policy, but in the real estate speculators dominated the market, tax is completely into the extra price of housing consumers.
resolve the current real estate issues, the central government can no longer confined to the past policy of the kind of tinkering, but should be determined both from the supply and demand thorough regulation. from the supply level, should be determined, completely shattered by the current Under the Government's planning and management, so that the collective farmers, urban residents to become the main housing development, with the mechanism. This is a people live in private housing to the most basic policy, but also market economy provided by the Government to the people the most basic rights. At the same time, housing investment and speculation should be (including vacancy) included in the supply management areas real estate property taxes by imposing progressive tax and land policies to promote the rent policies to ensure low-income housing rights. From the demand side, the most important standards of consumption to clearance issues, such as requiring each family can only be declared a city in the country included in the consumption of housing areas, to access to housing credit and tax and other preferential policies, some are included more than predict the trend of real estate in China in 2007 both simple and complex. simply, we can according to the 2006 real estate prices inertia, very easy to predict at least in the first half of 2007 before rising domestic real estate prices will continue to conclusions; complicate matters, real estate prices faced a new set of policy variables impact if policy formulation and implementation in place, house prices under control in late 2007 and gradually decline, but also entirely possible. Since 2006, two interest rate adjustment will be January 1, 2007 formally implemented, will inevitably demand a certain inhibition of speculation, so the first half of 2007, the domestic real estate price rises over the same period in 2006 can not be; Second, the domestic real estate project-related corruption investigation and punishment may be routed to a central city real estate bubble, and the surrounding cities a certain demonstration effect; again, 2007 may be real estate speculators and consumer demand for the game among the most crucial year, based on 2008 Beijing Olympics after the expected drop in home prices, speculators may choose to hoard the shot before the Beijing Olympics on housing, it will be possible after its formation in 2007, a seller's to buyer's market reversal, the real estate bubble may be in Beijing, Shanghai, etc. central cities in the fall; Finally, if the central government can adopt the recommendations of insight, published in 2007, more effective and resolute measures against real estate speculation, the domestic real estate bubble may well occur before 2008, the trend of reduction .