Hello everyone, I'm the head of the hall.
Today's content begins with a state-run report.
On February 21, important official media published an article.
The argument of the title is quite powerful: the future development of China's real estate market still has solid support!
The arguments presented in the content are also quite "substantial": with the advancement of urbanization, more than 10 million rural residents will enter cities and towns every year, which will form an important driving force for the real estate market.
The tone of the conclusion given is very firm: we should be full of confidence in the stabilization and recovery of the real estate market and its future development.
Sure enough, it was the peasants who silently endured everything.
You say, is this trick effective?
We can't say it, and we don't dare to say it.
But the reason for this lies in the hukou system.
Hukou is a unique land-based population management system that has been around for thousands of years.
In the past, because of the agrarian society, the land was the foundation of the operation of dynasties and generations.
The peasants cultivated in one acre and three points of land, and the feudal dynasty formed gangs and factions in the division of interests, and the struggle was nothing more than two words: land.
In ancient times, the factor of production of the entire society was only land, so to speak, whoever controlled the land could become an emperor.
However, in the 21st century, the factors of production in the whole society are no longer only land, but also population, technology, and capital are all factors of production.
If you still copy the previous one, there will be many problems.
Because in the process of urbanization, population mobility is the general trend.
Taking migrant workers as an example, Henan, a major province with a large labor population, has more than 10 million people working outside the country all year round.
Many high-rise buildings in big cities were built by these migrant workers, but their medical care has not been guaranteed because of the household registration system.
There are also young people who work hard in big cities, why in the past ten years, many young people have preferred to increase leverage, even if it is a mortgage interest rate of 6.00 o'clock, and they have to grit their teeth and get on the bus?
Because they are outsiders and do not have a household registration in a big city, it means that they lose the resources such as medical care and education in the big city where they are located, and buying a house has become one of the best ways to enjoy these resources.
But it seems to have forgotten the reality of the situation: there is no job guarantee in the city, and when the rural people come in, what income will they use to support the purchase of houses?
The problem of real estate is, to put it bluntly, a problem of debt cycle.
To put it simply, no matter what time it is, once you borrow money, it creates a cycle.
For example, if you plan to buy a mobile phone that you can't afford at the moment, such as the latest Apple 15, or the one far ahead, you find that ** will exceed 10,000 yuan, and your income is only 3,000 yuan, so your consumption will inevitably exceed your income.
So you have to borrow money, whether it's borrowing from friends and family, or brushing your face on a certain platform, it looks like you're borrowing someone else's money, but in fact you're borrowing money from your future self.
For most migrant workers, once you have completed the loan and bought the phone, you will have to reduce your spending level in the rest of the year to pay off the debt.
This model of borrowing first for consumption and then saving money is actually a cycle.
This is true for individuals, and it is true for a country's economy.
Growth in some economies relies heavily on borrowing to invest in fixed assets, such as real estate, such as infrastructure.
As long as this economy produces borrowing behavior, it will certainly not escape the debt cycle.
In the early days of the debt cycle, emerging economies saw cheap labor and inadequate infrastructure, so they went in two directions.
The first is to use cheap labor to increase exports and earn foreign exchange.
Second, it is keen on infrastructure construction and increases the level of national income by making the economic cake bigger.
At this time, there will be more and more borrowing behavior, and at the same time, it will become bigger and bigger, and the overall economy will also move forward.
The more you borrow, the faster it will develop, however, it is easy to get into the bubble phase.
In the bubble phase, reckless lending and unrealistic expectations create unrepayable debt.
At this time, the bank will be aware and start to actively shrink the bubble.
For example, if the growth of capital and credit is curbed by some means, then the problem of debt repayment will be exposed.
This means that economic growth, which used to rely on borrowing, will slow down, and at some point, the accumulated debt service problems will burst and the bubble will burst.
This is a general evolution of the debt cycle.
So how do you resolve the debt cycle? In fact, it is how to solve the accumulated debt generated by previous borrowing, in other words, it is a problem of deleveraging.
Specifically, we have two:
The first is to remove the leverage of real estate companies.
In fact, we have seen a lot in this regard, the most obvious is that the central bank has a blood transfusion, or a local bailout.
For example, the cheap money psl of the reboot
and the landing of the "white list" of real estate enterprises.
As of February 20, 162 projects in 57 cities have received bank financing, totaling 294300 million yuan, an increase of 11.3 billion yuan compared with before the Spring Festival holiday.
Another example is the acquisition of 4207 sets in Chongqing, which is still the first batch of **, and the strength behind it is estimated that it will only get bigger and bigger.
On the one hand, it will give blood transfusion and send funds to real estate enterprises, and on the other hand, it will solve the inventory that real estate companies cannot sell.
In terms of support for real estate companies, although it is not biological, it is better than biological.
The second is to remove the leverage of the residential sector.
A person has borrowed money and accumulated debts, and for this person, solving the debt is nothing more than two paths:
The first is to raise personal incomes so that income growth outpaces debt.
The second is to appropriately reduce debts and let the person pay less every month.
Which is better? Moving your toes knows that you are the first.
I don't know if you have noticed it, but in 2023, in fact, many countries have made the same action: salary increases.
Of course, one of the main reasons for their workers' wage increases is to cope with prices**.
Maybe at this time, some friends asked, why didn't we get a raise?
Well, how do you say that?
Let's answer you like this:
Excuse me, the salary is not good, hasn't it been like this all these years?
Is there any serious work? Sometimes, find your own reasons.
Don't open your eyes and talk nonsense, it's not easy for bosses!
Since the income cannot be raised, it can only reduce the repayment of debts.
So we can see that the central bank recently lowered the five-year LPR, which is the mortgage rate, by 25 basis points to 395%。
If you buy a house, you are carrying a 30-year mortgage of 1 million, a decrease of 25 basis points, that is, about 145 yuan less per month.
From the perspective of property market debt, if 10 million rural residents become new urban citizens every year and buy houses, it will help resolve the property market risk.
From the perspective of residents' debt, under the premise of not increasing their income, it is actually quite difficult for them to buy a house and take a 30-year mortgage.
According to Founder Macro data, the leverage ratio of the residential sector is now close to 70%.
It's not that if you throw out a household registration benefit, the current property market problem can be easily solved.
In addition, the banner of "stimulating consumption" has been being held up, and the money of workers is not blown by the wind, but earned by hard work every day.
The harder the money comes by, the less dare you spend it indiscriminately.
Although I have said so much, there is a high probability that the general direction of farmers becoming new citizens of the city will happen in the future.
In June 2022, the state issued the "14th Five-Year Plan for New Urbanization", which mentioned that promoting the urbanization of the agricultural transfer population would be the primary task of new urbanization, and proposed to deepen the reform of the household registration system.
Therefore, promoting the "citizenization" of peasants will certainly be accomplished.
It's just that the peasants who have become new citizens, what should they do after they enter the city? Can I make sure that my income can afford to buy a house? This is a problem that has to be faced.
Going back to the debt cycle, the old era of borrowing to stimulate economic growth is gone.
What should be faced, sooner or later.
Debts that should be repaid must also be repaid.
In the final analysis, it is not a question of whether to pay it back, but when and who will pay it back.
Like most dramas, the debt cycle is like a drama that rises and falls and repeats itself throughout history.
Okay, that's all for this issue, and we'll see you next time
Can encouraging farmers to go to the city to buy houses be effective?