Xian Langping Talks About Housing Prices: 7 Major Reasons Why Housing Prices Do Not Fall And It Is Difficult For Ordinary People To Buy A House

Lang Xianping revealed 7 reasons why housing prices have not fallen yet and people will never be able to afford them. On September 18, the National Bureau of Statistics released data saying that the average price of newly built commercial housing in 70 large and medium-sized cities in August this year increased by 0.06% month-on-month. The increase was narrower than the 0.14% increase in July, but it was still higher than the 0.02% month-on-month increase in June. This is the third consecutive month that average house prices in 70 large and medium-sized cities have increased. Previously, data released by the National Bureau of Statistics in August showed that among the 70 large and medium-sized cities in the country, 50 cities saw a month-on-month increase in the price of new commercial housing in July, while this figure was only 25 in June. The number of cities with increases in July exceeded the sum of the previous six months. In addition, according to data released by the China Index Academy in early September, in August 2012, the average (newly built) residential price in 100 cities across the country was 8,738 yuan/square meter, a month-on-month increase of 0.24%. This was another increase after the month-on-month increase in July. What followed was intensive statements from relevant ministries and commissions and their responsible persons on the regulation of the property market. Finance Minister Xie Xuren said that it is necessary to strictly implement differentiated housing tax policies, strengthen tax collection and management related to the transaction link and the holding link, and steadily promote the pilot reform of personal housing property tax. Zhang Ping, director of the National Development and Reform Commission, pointed out that in the second half of the year, it is necessary to stabilize the real estate market control policy, resolutely curb speculative investment demand, effectively increase the supply of ordinary commercial housing, especially small and medium-sized housing, and prevent housing prices from rebounding. In fact, real estate regulation has been going on for more than a year, and various regions have successively issued "purchase restriction orders" and other regulatory measures. However, to this day, it is still difficult to see housing prices returning to a rational level. What are the reasons for this? One of the reasons: Failure to understand the source of real estate speculation funds. Many people are very angry when they mention the Wenzhou real estate speculators and Shanxi coal bosses. They think that it is because of the existence of these people that housing prices are so high and that everyone cannot afford to buy a house! The current average gross profit of our manufacturing industry is only 5%. If we exclude some other expenses, our manufacturing industry basically makes no money. Comparatively speaking, house speculation is a matter with no technical content at all. Many people who used to be in the industry are now basically speculating in houses. Their views are basically the same. They all believe that in the current environment, doing business is tiring and making no money, while real estate speculation is easy and profitable, so they cannot be entirely blamed. But on the other hand, some of the measures we introduced in the past also gave Wenzhou real estate speculators and Shanxi coal bosses an opportunity to take advantage. For example, in 2008, in order to stimulate real estate, the central bank lowered interest rates four times within a year, reaching 1.71%. At the same time, there is also a 30% discount on the interest rate of home purchase loans for second-home loans. Many investment speculators have taken advantage of this preferential policy to realize their own real estate speculation purposes. Reason two: Credit regulation has not touched real estate. With housing prices soaring and people complaining, our government has intensively introduced many regulation policies. However, through the analysis of these regulation policies, I found a very interesting thing, that is, even now, some of our credit regulation has not touched real estate. The reasons are simple: First, for local governments, land transfer fees are a huge amount of revenue. Second, in the current environment, what our financial institutions fear most is falling house prices, because for financial institutions, falling house prices is the biggest systemic risk, and financial institutions will naturally not destroy themselves.