Source: Wall Street Journal
Stella yifan xie
The Chinese real estate market has stabilized after two years of downturn.But there is a problem that is still hindering the recovery of this market: the residential house is seriously supplying overcurrent.
Data provider Wind data shows that the unpaid area of Chinese residential completion in February was 3.5 billion square feet (about 325 million square meters).According to some estimates, this is equivalent to about 4 million houses.This is also China's most serious supply since 2017. At that time, China was conducting the "shantytown renovation" project. The project aims to promote the demand for new residential buildings by demolishing dilapidated buildings.
The calculation results of the real estate consulting agency, China Real Estate Information Corp., showed that about one -third of all newly built houses in 2022 were not sold, which was the highest proportion since 2015.
Economists said that in small cities with a population of millions of or less, this problem is the most serious.Economist Kenneth Rogoff and Yang Yuanchen published a paper last year that after a long -term construction boom, more than 640 third -tier cities in China now have nearly 80%of the total Chinese residential inventory.Compared with large cities such as Beijing and Shanghai, which are growing rapidly, these cities have weaker demand.
CHINA Real Estate Information Corp. estimates that the housing of the well -known third -tier cities North China takes nearly six years to digest inventory, and Shanghai needs seven months and Beijing needs nearly two years.
Krier said that of the 50 cities monitored by the agency, it took an average of 20 months to digest excess residential supply.According to data from the National Association of Realtors, the United States currently has a 2.9 -month -old house supply volume, and the US government data shows that the pre -sale house supply is 8.2 months.
In February, the prices of new housing in first -tier cities in Beijing, Shanghai, Shenzhen and Guangzhou rose 1.7%year -on -year.According to data from the China Statistics Bureau, housing prices in third -tier cities have fallen by 3.3%, but the speed of decrease is slower than the previous months.
Overall, the price of new houses in 70 large and medium -sized cities has increased by 0.3%from the previous month, and has been declining from the previous month since August 2021.
If China cannot stabilize the price of housing in third- and fourth -tier cities, it may crack down on residents' confidence and consumption willingness in many parts of China, thereby restricting the extent of China's overall economic recovery this year.It is estimated that two -thirds of China's urban population lives in third- and fourth -tier cities.
In the long run, the needs of excessive digestive housing may mean that the construction of new houses will be sluggish for a long time, which will cause China to lose one of the largest growth motivations and sources of employment.For Chinese local governments with debt, the construction of new houses is also crucial. These local governments rely on the revenue of land to sell land to developers to balance the budget.
ROGOFF and Yang Yuanchen concluded in the papers last September that from now to 2035, real estate construction demand in third -tier cities needs to be reduced by about 30%in order to avoid excess supply.
Before the outbreak, third -tier cities attracted some home buyers, because house prices here were usually much lower than that of Chinese cities.The speculators swarmed from all over China. Some people snapped up a number of houses and then vacated, hoping to obtain investment income.Developers have strengthened their construction to meet the expected needs.
But the Chinese government's crackdown on speculation, coupled with the unfavorable population structure and other problems in small cities, has led to the decline in attractiveness of these cities.
Beihai, a coastal city in Guangxi Province, southwestern China, is known for its beach and warm climate. According to local real estate agencies, tourists decreased during the crown disease epidemic, which led to real estate sales downturn.
Beihai City has a population of 1.9 million, known as "Miami of China". A salesperson of a local real estate agency company said that the average house price in Beihai has been around 8,000-9,000 yuan per square meter in 2019.Fall to about 4000-5000 yuan per square meter at the end of 2022.
China canceled the dynamic zero -resistance policy at the end of last year. It was boosted. During the Lunar New Year in January this year, Beihai ushered in the return of a large number of tourists.But the salesman said that the local house prices did not return to the level before the epidemic, because the speculators were reduced.
A local residents who have two real estate in Beihai said she did not expect how much a housing price would rebound, although she thought that people were still willing to live in Beihai.
She said that there have been excess housing in cities like Beihai.
The homeowners of other third -tier cities are pessimistic.Chen Yong, who has two houses in Qinhuangdao, northeast city, said that according to the number of lit houses he saw at night, and the estimated number of owners who spoke in the Internet chat group, about 40%of his residential houses in his place are vacant.of.
Chen, who works at a state -owned oil company, said that there are too many residential vacancy, and there is no reason for further residential prices.
In many parts of China, the mortgage interest rate is lowered and other subsidies are provided to attract the first buyers, and the demand of some large cities has quickly recovered.According to data from the Lianjia Research Institute, in Shanghai, the transaction volume of second -hand housing rose to the highest level in February in February.
ANZ Group Economist said in a research report that China's real estate industry is undergoing a rebound. After dragging down the Chinese economy in 2022, the gradual recovery of the real estate industry will be against China GDP in 2023The growth contribution is up to 0.5 percentage points.The bank is expected to grow by 5.4%this year.
Nevertheless, Australia and New Bank said that even if the real estate recovery continues, the annual sales may still reach only 90%of the pre -epidemic level.
Many predictors believe that unless the government takes more measures to stimulate demand, excess housing in some cities will continue to exist. Although stimulating measures may lead to more speculative behaviors, the government is unwilling to encourage this behavior.
According to Goldman Sachs, from 2010 to 2020, the demand for urban houses in China was an average of 18 million units per year.Goldman Sachs estimates that with the age of the Chinese population and the weakening of the demand for replacement of real estate, this number will fall to 6 million units per year by 2050.In 2022, the population growth rate of the urban cities and towns reached the slowest level in 42 years.
"We did think that the peak period had passed," said HUI SHAN, chief Chinese economist at Goldman Sachs Group, and said that she expected that the annual demand for new houses in the next decades will steadily decline.
Betty Wang, a senior economist of Australia and New Banking Group, said that if developers continue to reduce the launch of new projects and prioritize existing housing, the market may gradually absorb some excess inventory.However, with the recovery of the market, the temptation of additional construction may be strong.
Beijing can also renovate existing buildings instead of building new buildings by demolishing more old buildings to reduce supply.David Wang, the head of Economic, Credit Suisse, said this is not surprising in the Chinese market, because the average life expectancy of Chinese houses is onlyAbout 35 years, much shorter than the United States.
