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Housing loans in 2018 may be reduced by trillions.

Time: 2018-02-11         Source: China Times         Author: China Times

Since 2018, with the strict control of bank credit and trust funds entering the real estate market, the financing of housing enterprises has become more and more difficult. Some banks have even suspended the acceptance of new credits in the real estate industry or suspended the real estate development loan business.

"In previous years, even if the banks tightened, other channels were smooth. Housing companies could still find a lot of money to maintain in the society. But this time, the regulatory authorities kept out of documents and broke many back roads of housing enterprises. The company was forced to go abroad for financing.” A brokerage official in Shanghai told the China Times reporter that the intensity of this de-leverage seems to have returned to 1997.

A person from a trust company in Chongqing told reporters that the average financing cost of the top 50 real estate enterprises through trusts is 9%-10%, and the 50-100 strong ones are around 12%.

According to the reporter's understanding, large-scale housing companies have issued internal notices to reduce land acquisition and maximize the flow of cash.

Housing financing channels blocked

According to statistics from Centaline, 15 real estate companies have announced sales of 173.774 billion in January 2018, up 74% year-on-year. Although sales have set a new record, housing companies have begun to feel a bit of coolness.

An insider of a securities firm in Shanghai told the reporter of China Times that the source of funds for housing enterprises mainly had several channels. First, the bank development loan should meet the requirements of “432”. Second, the trust also needs to meet “432”. The third is non-standard. Financing, do not mortgage pure credit can be financed, formal financing channels are rapidly shrinking, other financing channels such as P2P, and local equity financing platforms, such as Guangdong Gold Exchange, Qianhai Gold Exchange, Chongqing Gold Exchange, land exchange All of them can raise money for housing companies, but now even the worst financing platform is restricted.

According to the regulations of the China Banking Regulatory Commission, real estate trust loans must meet the "432" conditions, 4 means that the real estate company 4 certificates are complete, 3 means that the real estate company in the project must have at least 30% of its own funds, 2 means that the financing party has at least two Level or above qualification.

Housing enterprises through bank loans, mainly in two ways, land funds and development loans, the former housing enterprises do not need to take the land mortgage, the top 30 strong housing enterprises, only rely on the company's pure credit guarantee can borrow from the bank, but according to the reporter, No bank is willing to do it now, and it must be mortgaged.

"The development of the joint-stock banks has no quota, and there are some quotas for the construction of the China Postal Service Bank, but all the bank financing can not be done." A senior financial practitioner told reporters that large housing companies can also issue Debt, but issuing bonds is now difficult.

The trust company can only do two businesses at present. Land loans and development loans must be mortgaged. Their funds are raised through banks.

According to data from the benefit trust network, in 2017, 68 trust companies issued a total of 1,907 real estate collective trust products, up 123% from 2016, and the amount of funds raised from 271.733 billion yuan in 2016 to 626.102 billion yuan, a large increase. 130.4%.

Trust loans will become an area that will be refocused in 2018.

A person from a trust company in Chongqing told reporters that the average financing cost of the top 50 real estate enterprises through trusts is 9%-10%, and the 50-100 strong ones are around 12%. "Now an average trust is less than 300 million in a month. The number of projects that have already been sent out is close to 20 billion, and 20 billion are waiting for the meeting, mainly because there is no money in the market." According to the reporter, there are already large-scale housing enterprises. Internal requirements are made to maximize the flow of cash flow. Sunac’s sales in multiple cities require full purchases and funds are returned as soon as possible. However, most real estate companies are unable to take the land in a counter-cyclical period. Therefore, even if the regulation has been going on for more than a year, the enthusiasm of the real estate developers is not diminished.

According to the statistics of the Central Plains Real Estate Research Center, in 2017, the total amount of land acquisition by the 50 most active real estate companies reached 229.27 billion. Compared with the amount of land acquired in the same period of 2016, 1,366.8 billion, the increase reached 75%.

Insiders of a large real estate company in Shanghai told reporters that the cash flow of developers is always tense. Last year, the sales were good. At present, the capital chain is no problem. The main problem is that the pre-sale certificates are not available. The developers are very anxious. The price, the housing enterprises are not willing to cut prices, so they are deadlocked.

The above-mentioned trust company said that the capital chain of the housing company is very tight. Although the sales were good last year, there were many land acquisitions and huge development costs. Originally, real estate enterprises were highly leveraged. Once the bank scale was limited, the bond issuance review was limited. There will be problems with the main funding channels.

"The cost of real estate bond issuance in the past two years is mostly around 6%. It has not been able to start from the second half of last year. Only the assets of cash flow with abs and abn will be better." A large brokerage official said.

2018 mortgage or trillion

In addition to other sources of funds, the most important factor affecting the housing capital chain is the sales return, but the bank continues to tighten in personal loans.

Everbright Bank's personal loan manager told reporters that this year is not the same as last year's mortgage loan quota. "I don't know the specific figures, but 90% of the loans we put in the door are non-residential loans, such as operating loans, consumer loans, commercial housing mortgages, car loans and other personal loans."

Since the beginning of this year, the central government has repeatedly released signals that strictly control the flow of funds into the real estate industry. On January 13, the China Banking Regulatory Commission issued the "Notice on Further Deepening the Rise of the Banking Market". The focus of rectification includes the issuance of substandard non-compliance personal housing loans; it acts directly or indirectly as a means of financing or lending channels. The agency provides convenience for issuing down payment loans, etc.; comprehensive consumer loans, personal business loans, credit card overdrafts and other funds are used to purchase houses.

From January 25th to 26th, the China Banking Regulatory Commission held the 2018 National Banking Supervision and Management Work Conference, which also proposed to prevent and control financial risks this year. It will reduce the debt ratio of enterprises and strictly control the financing of high-debt enterprises. The excessive growth of the leverage ratio of residents continues to curb the real estate bubble.

Recently, the Shanghai Banking Regulatory Bureau also issued the "Notice on Standardizing the M&A Loan Business", requiring commercial banks within the jurisdiction to strictly abide by the regulatory requirements for large-scale real estate development loans, and not to issue any form of loans to the "four certificates incomplete" real estate projects. M&A loans shall not be invested in projects that have not paid the land transfer fees. Combined with the previous policy of tightening the funds of enterprises, the difficulty of obtaining funds for housing enterprises has once again increased.

On the morning of February 5th to 6th, the working conference of the People's Bank of China was held in Beijing in 2018. The prevention and resolution of financial risks ranked second in the 2018 task.

Affected by this, on February 7, real estate stocks plummeted, and Rongsheng Development and other stocks fell.

Lian Ping, chief economist of the Bank of Communications, said that the current growth rate of commercial housing sales and individual home purchase loans has fallen from a high point. Based on past experience, both are expected to reach the bottom in 2018. Simply assume that the bottom value of this round of real estate cycle is similar to the previous round. It is estimated that the new personal housing loan in 2018 will be about 3.3 trillion yuan, a decrease of 800-100 billion yuan compared with 2017. However, since many personal mortgages in 2017 may have been approved but not loaned, it is expected that personal mortgages in the first quarter of 2018 may still be released at a certain scale and will not shrink immediately.

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