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Five major banks seize beach rental housing trillion trillion outlet deposit pain points

Time: 2018-01-10         Source: China Economic Net         Author: China Economic Net

In 2018, many state-owned banks have successively “grabbed” the housing leasing market.

On December 18, 2017, the Bank of Communications announced that the Guangdong branch of the bank signed a strategic leasing agreement for housing leasing with a number of real estate companies and residential leasing platforms, including Vanke, Poly, and Foshan Jianxin Residential Leasing Co., Ltd. The signing parties totaled more than 150 billion yuan of intentional credit line.

Since the Construction Bank entered the housing leasing market in early November 2017, ICBC, China Construction Bank, Agricultural Bank, Bank of China, Bank of Communications and other state-owned top five banks have announced that they have entered this market, and have provided many financial products to developers and Individual tenants.

According to incomplete statistics from the Times Weekly reporter, as of now, China Construction Bank, Industrial and Commercial Bank of China, Agricultural Bank of China, Bank of China, and Bank of Communications have signed strategic partnership agreements with about 30 provinces and cities for the development of the housing leasing market, with a total amount of intentional credit support provided. More than one trillion yuan.

However, the ideal is very full and the reality is very skinny. A joint-stock bank in South China told Time Weekly that the rate of return on domestic rents is generally not high. Compared to direct loans to developers, long-term apartments have a longer life cycle and cost more.

“At present, the state-owned banks are still in the stage of exploring the housing leasing market, and there are no mature models for the profit model, operation and operation mode, and withdrawal. This is also the main reason why we have no action in this area.” Said.

Large state-owned banks preemptive layout

It is the Construction Bank that has made the most rapid and active moves into the housing rental market.

On November 2, 2017, CCB Guangdong Branch entered into a residential leasing strategic partnership with the Guangdong Provincial Housing and Construction Department and the Foshan Municipal Government. CCB will aim to provide a platform for government supervision and provide protection for customer transactions. It will target technology from the Funds, channels, and other aspects to give strong support.

On the same day, the Bank of China announced that the Xiamen branch of the bank had cooperated with Xiamen Municipal Bureau of Land Resources and Housing Management. The two parties will cooperate in the fields of land supply related to the housing lease market, construction of pilot rental housing, and innovation in housing lease financing.

One day later, the Shenzhen Branch of China Construction Bank and other 11 real estate companies including China Merchants, China Resources, Vanke, and Evergrande, and 11 enterprises and institutions including BYD (Quote 002594, diagnostic stocks), signed a strategic contract for housing leasing, and launched more than 5,000 sets of long-term contracts. Sources of rent, and the release of personal home rental loan products.

On December 18th, 2017, CCB Beijing Branch jointly launched more than 1,500 “CCB Homestead” homes with Beijing Safeguard Center, First Open Group, Financial Street (quote 000402, stocks of diagnostics) and other institutions. The bank has signed home-loan cooperation agreements with governments and housing companies in Chongqing, Shiyan, Zhongshan, Handan, Changsha and Liaoning.

Industrial and Commercial Bank of China also selected Guangdong as the first destination to enter the housing rental market. On November 16, 2017, ICBC Guangdong Branch's sales department signed a "strategic cooperation agreement" with the Guangzhou Municipal Housing and Urban-Rural Development Committee, which will provide RMB 500 billion in credit grants to participating entities in the Guangzhou residential leasing market; mid-late December The Industrial and Commercial Bank of China Beijing Branch also announced that in the next five years, it will provide financial support for all participants in the Beijing housing rental market with a total amount of not less than 600 billion yuan.

Immediately afterwards, the Bank of Communications entered the housing rental market. On December 18, 2017, Bank of Communications Guangdong Branch signed a strategic leasing agreement for housing leasing with a number of real estate companies and residential leasing platforms, and awarded more than 1,500 contracted entities including Vanke, Poly, and Foshan Jianxin Home Leasing Co., Ltd. Billion intent credit line, special for financial support for the development of housing rental business.

Previously, Bank of Communications had used Guangdong as a pilot to provide 20-year financing support for Foshan Jianxin Home Leasing Co., Ltd., realizing the first housing leasing support financing in the Guangdong region, and providing a financing solution for the purpose of cracking the bottleneck of housing leasing financing. .

In addition to state-owned banks, joint-stock banks have also frequently appeared in the housing leasing market. CITIC Bank (Quote 601998, diagnostic stocks) announced at the end of October last year that it will provide Country Garden Group with a supporting fund of 30 billion yuan in the long-term residential sector in the next three years and provide integrated financial services.

Coincidentally, President of the Ping An Bank (market 000001, diagnosis stocks) Hu Yuefei recently stated at the PACC's real estate finance annual meeting that at present, the Ping An Group is actively developing the research and construction of the housing rental financial service system, hoping to join hands with major housing companies. The housing system that promotes the provision of the mainstay, multi-channel guarantees, and the simultaneous sale and rental of goods is established at an early date.

The driving force of the large state-run military rental rental market is full. According to research, China's housing leasing market is about 1.1 trillion yuan, and the housing transaction market is about 15 trillion yuan in the same period. The scale of the leasing market is only 7% of the trading market, and averages over 40% in the mature markets such as the United States and Japan. Compared with the proportion, the difference is large.

Yiju Research Institute believes that the next 10 years will be a period of rapid development of the leasing market. It is expected that the nation's cities and towns will form an effective rental demand of 5.4 billion square meters in 2027; the scale of rent will reach 3.86 trillion yuan, an increase of 138% over 2017.

At present, China’s financial industry still focuses on bank financing. As bank capital enters the rental housing market, it will effectively promote more entities to participate in the rental housing market.

Return rate problem to be solved

In terms of specific models, state-owned banks, in addition to signing agreements with the government and granting credit to the housing enterprises, also supported tenants with more financial products.

The Industrial and Commercial Bank of China Beijing sublease leased housing development main body launched the "Leasing Housing Development Loan", the financing amount can reach 80% of the total project investment, the term can reach 25 years; for individual renters to launch "personal rental housing loans", the financing amount can reach 100 Ten thousand yuan and a term of up to 10 years.

In mid-December of 2017, CCB launched a “credit deposit” for landlords (lessors), which means that houses can also be “banked”. CCB Guangdong Branch divided “depository loans” into trilogy: the landlord sold its own housing lease rights to CCB, CCB paid all rents at one time, for example, a one-off payment of RMB 500,000 to the landlord for five years; then, CCB The property will be rented out by a professional leasing operator.

At the China Housing Leasing Summit held on December 20, 2017, Liu Jun, president of the Guangdong branch of China Construction Bank, disclosed that at present, the Guangdong branch of China Construction Bank has three major categories of companies, investment banks and individuals, and 40 financial products used to purchase A one-stop, full-category, secure leasing financial service system such as lease and renovation, renovation and maintenance, asset revitalization, and rental and consumption.

Times Weekly reporter learned from the Guangdong branch of Bank of Communications that in the area of ​​housing leasing, Bank of Communications has launched financial services such as financing support, platform construction, individual housing leasing, consulting services and other “full chain coverage, full product support, and integrated platform support”.

Zhang Dawei, chief analyst of Centaline Real Estate, analyzed that the loan credit products currently provided by the bank are likely to have the possibility of misappropriation of credit funds and the speculation of renting by two landlords. It is necessary for banks to increase their review of lenders.

In addition, rental returns are also a problem. In his recent speech, Ba Shusong, chief economist of the China Banking Association, mentioned his survey data: Currently, the rental returns of major cities are not high, basically below 3%, for example, 1.33% in Shanghai, Shenzhen. It is 1.34%.

Not long ago, at the 2017 China Housing Leasing Industry Innovation and Development Forum, Yang Jun, deputy general manager of the Bank of China Investment Banking and Asset Management Department, talked about the difficulties in the securitization of China's residential lease assets. Yang Jun said: "The housing leasing industry has a long operating cycle, a low rental yield, uncertainty in the profit model, lack of a mature financial measurement model, and a low degree of acceptability of rental cash flow forecasting in securitization. Most of them require external letterpress. , increase the cost of financing; securitization of assets is difficult to find, long-term high-quality supply of a large number of rental housing is relatively short.

Yan Yuejin, Research Director of the Yigou Research Center, told the Times Weekly reporter that while the profitability of the rental housing market was temporarily low, the state-owned banks actively participated in it, and they also had corresponding policy guidance. Participants follow up.

Asset securitization warming up

In the trillion-dollar housing leasing market, how to solve the problem of long investment time, low leasing rate, and high capital demand? Asset securitization or solutions to the above problems.

In this regard, Zhang Bo, chief analyst of the Housing Research Institute of Housing and Housing, pointed out that at present, the long-term rent rental rate of domestic apartments is only 3%, and many project returns do not even reach the level of financing costs. In the future, we can increase the financial support for housing, enrich the tax incentives and dividends system for real estate investment funds (REITs), and expand the variety of product types.

In 2017, several single-apartment asset securitization products were launched on the Chinese market. In particular, in the short period of two months at the end of the year, six long-term apartment financing plans were intensively mobilized, involving nearly 40 billion yuan in funds.

On October 11, 2017, the first long-term rental apartment asset class REITs in China was officially “breaking ice,” which has opened the financing gate for long-term rental apartments.

On October 23, 2017, China's first single state-owned enterprise rented REITs product was approved, and Poly Real Estate (Quote 600048, a diagnostic stock) was issued with a quota of 5 billion yuan. On December 1, the country’s first single rack type long-stay apartment was issued. Mortgage-backed securitization products were approved, and China Merchants Shekou (market 001979, diagnosis stocks) was issued with a quota of RMB 6 billion.

On December 11, 2017, ABN, the first long-term rental apartment on the inter-bank market, was launched. China Merchants Shekou and China Construction Bank jointly launched RMB 20 billion in “Fasting - Jianrong Long-term Rental Apartment Series Asset-backed Notes (ABN); December 26th. , China's first single private-owned enterprises long-term apartment rental rack type equity REITs approved by the Exchange, involving a total amount of 3 billion yuan.

“In 2016, the entire real estate industry accounted for 74% of the new financing scale.” Yang Jun said that for capital-intensive companies such as real estate, this traditional financing method has certain limitations. Asset securitization is based on the stable and predictable cash flow of the underlying assets.

“The solution to the problem of the subject’s credit in the financing mode is more important to speed up the turnover of funds, and has a very positive effect on revitalizing stocks, improving liquidity, and improving financial conditions,” Yang Jun said.

According to Gan Qishan, director of Shanghai Valuation Department of Savills, in 2016, asset securitization products based on real estate in China accounted for about 6% of all securitized products. By 2017, this proportion has rapidly risen to 12%. %-13%. Since there are few domestic investment channels, this type of new financial product is very popular among investors in the market.

Li Peijia, a senior research fellow at the Bank of China International Finance Research Center, said that the current market for leased-liability securities in China is still at the initial stage of exploration. Although it still faces many problems, such as low return on assets and lack of supporting financial instruments, with further exploration, it will provide experience in many aspects including policies and support in the later period.

“For the innovation of the financial sector, it is expected that there will be various types of policy support in terms of leasing companies issuing bonds and conducting securitization in 2018. Similar financing is also a good way to withdraw funds, which helps reduce costs and is also an innovation of institutional type leased products. An important embodiment of the report.” Yan Yuejin analyzed the reporter of the Times Weekly that due to the launch of several single-class real estate trust investment funds in 2017, it is expected that relevant supporting policies will be introduced in 2018, basically conforming to the pre-pilot point and establishing norms. practice.

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