房地产新政)

CHINA’S“NEWDEAL”MEASURESTOCOPEWITHITSBUBBLINGHOUSINGMARKETLUDing&HUANGYanjieEAIBackgroundBriefNo.544DateofPublication:23July2010 iExecutiveSummary1.SinceDecember2009,Chinahasimplementedaseriesofpolicymeasuresdubbedbythemediaasthe“NewDealinHousingPolicy”(fangdichanxinzheng,房地产新政),tocooldownthehousingmarket.2.Forretailbuyers,theNewDealisacombinationofmortgagerestrictions,purchasequotas,andextendedwaitingperiodforresaletocurbindividualhousingpurchaseforinvestmentorspeculativepurposes.3.Forinstitutionalplayers,theNewDealtightensregulationsandimposesfinancialrestrictionstodiscourageorpreventdevelopersorgovernment-linkedcompaniesfrompurchasinglandforhoardingorresale.4.Themonetarypolicyhasalsobeentightenedtoincreaseinvestmentcostandthegovernmenthaspledgedtoincreasethesupplyofhousing,especiallylow-costhousing.5.TheNewDealwasformulatedtoeasesocialandeconomictensionscausedbythesteepriseinhousingprices,especiallyinmajorcities.Theemergenceofapropertybubblehasbeenevidentbyvariousgauges.6.Theemergingpropertybubblehasbeenathreattomacroeconomicstabilityandfinancialsecurity.Italsofrustratesandincensespeople(especiallytheyoungandnewlyimmigratedurbanresidents)whoaspirebuthaveyettobecomehomeowners.7.TheimpactoftheNewDealisevidentinsomecitieswherehousingpricesareplateauing.However,thecentralgovernmenthastoproceedwithcautiontoensurethattheNewDealwillnotprickthepropertybubbleabruptlyandderailthemomentumofnationaleconomicgrowth. ii8.Localgovernmentsrelyheavilyontheso-calledtudicaizheng(土地财政,land-sourcedfiscalrevenue)fortheirbudgetneeds.Investorsandspeculators,includingmanymiddle-andupper-classurbanresidents,fearthattheburstofthebubblewouldreducethevalueoftheirassets.9.Realestatedevelopers,manyofwhicharestate-linkedbusinesses,havealsobenefitedfromaboominghousingmarket.Banksconsidermortgageloansastheirbestassets.10.ImplementingtheNewDealmeasuresisalsonoteasy.Differentiatingbetweenfirst-timehomebuyersandmultiple-homebuyersisanexample.11.Duetothemultipleinterestsandhighstakesinvolved,thegovernmenthastoproceedwiththeNewDealcautiously.Therearesignsthatthegovernmentmaysoonfine-tunetheNewDealmeasurestoensurethattheywillnotjeopardizemacroeconomicstability.12.Inthelongrun,policymakersinBeijingwillhavetoanswertothechallengeofprovidingaffordablehomestothehundredsofmillionsofruralmigrantswhomovetoworkandliveinthecities.Fiscalrestructuringatthecitylevelisnecessarytoprovideappropriateincentivesforlocalgovernmentstofacilitatethedevelopmentoflow-costhousing.