China's real estate market has entered a period of adjustment after more than 20 years of rapid development. As early as many years ago, real estate tycoon Wang Shi made two predictions:First, housing prices will be the best, and second, the state will increase the construction of affordable housing. Today, both prophecies have come true.
In 1998, China's housing prices began to grow rapidly, and more than 20 years later, the national average housing price has risen from 2,000 yuan square meters to 1 in the first quarter of 202110,000 square meters, an increase of 55 times, and the increase in first-tier cities has reached more than 20 times.
However, since the epidemic in 2020, China's real estate market has cooled down significantly, and housing prices in many cities have begun to appear.
At the same time, China is also actively promoting the construction of affordable housing. In 2022, 40 key cities will add 94 new rental affordable housing20,000 sets, and will continue to increase construction efforts in the next few years.
Low-rent housing and co-ownership housing will become an important means to solve the housing problem of low-income families. The vigorous development of affordable housing predicted by Wang Shi is also gradually being realized.
At present, China's real estate is facing an obvious state of surplus. Housing prices in many second- and third-tier cities**, and the growth rate in first-tier cities has also begun to narrow. A large number of second-hand houses are listed for sale, but the transaction is deserted.
This puts enormous pressure on many speculative families who hold multiple properties.
The first is the problem of selling a house. The current real estate market is in a downturn, and buyers often prefer new homes to second-hand homes, making it difficult to sell second-hand homes. Some speculators have tried to sell their properties, but months have passed and no one has paid attention.
The second is mortgage pressure. Holding multiple properties is expensive, with large monthly mortgage payments. Reduced house prices** and incomes can add to the repayment burden. Some families can no longer bear the pressure and choose to abandon their houses and cut off their payments. The number of foreclosure houses in China has surged from 9,000 in 2017 to 1.6 million in 2022, an increase of 178 times.
Finally, China is expected to start collecting property taxes in the next few years. This will directly increase the cost of households with multiple properties. Hoarding properties for speculative purposes will no longer be viable.
At present, China's real estate market has entered a period of adjustment, and Wang Shi's housing price prediction is coming true. At the same time, the state is also accelerating the construction of affordable housing. This is beneficial to addressing the housing needs of those who just need it.
Households that speculate excessively will face the triple blow of unsold houses, increased debt pressure, and future property taxes. The development of the real estate market is returning to rationality, and another prophecy of Wang Shi will gradually come true.