Policy changes again! Recently, there has been a flurry of positive news from various places across the country, with clear signs of "policy loosening" in the real estate market. However, despite this, the transaction volume of both second-hand and new houses in various places has not shown any significant improvement. What exactly is going on? Can we still buy houses in the future? Today, let's analyze together:

From the recent favorable policies for the real estate market across the country, there are roughly two major aspects.

One is in the area of purchase policies, where many places have relaxed purchase restrictions, reduced deed taxes, increased housing purchase subsidies, and relaxed the value-added tax exemption period for second-hand houses, etc.

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The other is in the area of credit policies, where from local housing funds to banks, there has been a concerted effort to reduce the down payment ratio, cancel the requirement for subscription and loan recognition, and many banks have also reduced interest rates.

In summary, over the past week, there has been a continuous stream of positive news in the real estate sector across the country, with the intensity and scope of these policies surging, which is quite rare.

Analyzing the reasons for the introduction of these favorable policies, the most direct reason is probably related to the significant decline in the transaction volume of commercial housing in various places since the beginning of this year. According to relevant data, the transaction volume of the real estate market this year has decreased by more than 30% compared to last year. The hustle and bustle of the past in sales offices and real estate transaction halls have long disappeared, replaced by a desolate scene. Some properties have seen as few as 1-2 transactions in a month.

Looking at the buyer's market, influenced by policy and other factors, people's enthusiasm for buying houses has been unprecedentedly low. Speculators fear that they have bought at the peak and are even in a hurry to sell their properties; while those in urgent need of buying a house also have concerns about the instability of housing prices, fearing that a sharp drop in prices will cause them losses.There is still another reason, influenced by the pandemic and other factors, that everyone's income has decreased to varying degrees. Those who bought houses before might face issues with their mortgage repayments. Now, to empty several wallets and take on a huge debt to buy a house does indeed require a certain amount of courage!

Various signs indicate that the national policy of "housing for living, not for speculation" in recent years has gradually begun to take effect. The real estate market trend is also gradually returning to the right track, allowing residents to have their own homes and fulfilling the housing dreams of those in urgent need. This is the common wish of everyone and also the result that our country's policy regulation hopes to see. It is hoped that a large amount of hot money will return to fields such as manufacturing and high-tech industries that can boost the economy and drive employment. However, the impact of the pandemic and other factors has accelerated this transformation process.

A renowned economist recently stated publicly that the current real estate market has reached a consensus for the first time since the housing reform in 1998, which is that the real estate industry is on a downward trend. The "golden age" of real estate is over, and falling housing prices will become the norm in the future. The year 2022 will become the new beginning of China's real estate industry.

Does it sound a bit alarming? Whether it is an exaggeration or not, we will leave it to time to judge. However, the current reality is not much better. According to data statistics, the domestic real estate market has become saturated, with 96% of families owning their first home, 41.5% owning a second home, and more than 10% owning three or more homes. In the future, there will be fewer people in urgent need of buying a house, and the situation of supply exceeding demand in the real estate market will become more prominent.

It can be said that the decline in purchasing power will have a huge impact on China's real estate market. If the property tax, which has already been on the agenda during the 14th Five-Year Plan period, is officially introduced, then housing prices will return to rationality more quickly and will be directly linked to the income of local residents.

However, from the perspective of urban development, super first-tier cities such as Beijing, Shanghai, Guangzhou, and Shenzhen, as well as first-tier cities with great development potential, will still have purchasing power and urgent needs due to the continuous positive growth of the population. Housing prices will remain strong and may even continue to rise. At that time, a polarized situation will emerge. Therefore, whether you need to buy a house in the future depends on the development status of your city.

So, will you buy a house in the near future? What do you think the future trend of housing prices will be?

Everyone is welcome to leave a message and comment, let's discuss together.That concludes all the content for this episode. If you have any topics you'd like to know more about in the area of finance and wealth management, please feel free to leave me a message.