Is it a good time to sell your house at a much lower rate than the banks?

category:Finance
 Is it a good time to sell your house at a much lower rate than the banks?


Behind this is not only the rising house price year by year, but also we can find that compared with the income of residents, the rent in domestic hot cities is not cheap. However, experts believe that with the guidance of relevant policies, the stability of the rental market can be expected.

Only 1 citys rental sales ratio is at the international reasonable level

Housing rental sales ratio refers to the ratio between the monthly rent per square meter of use area and the house price per square meter of construction area. In the world, the rent-sale ratio used to measure the good operation of a regional real estate is generally defined as 1:300-1:200.

For real estate holders, the low rent and sale means that the rental return rate of the real estate is low, which is far less than the income from the one-off sale of the real estate. In the 50 large and medium-sized cities in China, the average rental return rate is 2.2%, lower than the bank deposit rate of 2 years (2.4%), and the rental return rate is at a low level.

Among the above 50 cities, the housing rental sales ratio is arranged from low to high. Among the top 10 cities with low rental sales ratio, there is only one third and fourth tier city, the rest are second tier cities, and Xiamen (1:1075) has the lowest rental sales ratio.

From the perspective of city level, the average rent-sales ratio of the first tier cities is 1:636, reaching 53 years; the average rent-sales ratio of the second tier cities is 1:580, 46.9 years; although the house price of the third tier and fourth tier cities is relatively low, the demand of the rental market is even weaker, and the rent-sales ratio is slightly lower than that of the second tier cities, 1:556.

Among the first tier cities, Beijing and Shenzhen have high house prices, with the lowest rent-sales ratio and the return on rent of 1.8%; Shanghai has the highest rent-sales ratio and the return on rent of 2.0%; Guangzhou has the lowest rent-sales ratio and the return on rent of 1.8% in the first tier cities. The rental return rate of four cities is no higher than 2%.

The top 10 cities with high rental sales ratio are mainly concentrated in the northeast region, such as Harbin, Shenyang, Changchun and Dalian. The economy of Northeast China is relatively weak, the attraction of foreign population is not strong, and the house price is relatively low. However, the capital city of northeast province has a strong attraction to the migrant workers in the region, the leasing market is hot, and the rent is relatively high.

Harbin is the city with the highest rent to sales ratio, with a rental return rate of 4.0%, and a rent to sales ratio of more than 1:298. It is the only city in the above 50 cities with a reasonable international rent to sales ratio.

Harbin has high rent and low price, which is rare in large and medium-sized cities in China. According to the report, Harbins population inflow is weak, the house price is in the depression of the whole country, and the current house price is not high. As the capital city of Heilongjiang Province, Harbin has a high attraction to the migrant workers in the region, an active rental market and a high rent.

Behind heavy purchase and light rent: house prices rise year by year

House rental income is not equal to bank deposit rate, should we sell houses in time? This is not the case in terms of market performance.

If the house price can rise steadily, it can enjoy the value-added of the real estate when it is rented out and charged, which may be more cost-effective than selling the real estate directly and saving the money in the bank.

What is the trend of house prices? On the whole, in recent years, most cities in China have seen more price rises and less price falls, and have not seen a significant correction.

The first financial reporter combed the data of the past 10 years and found that the average price of commercial housing in China has been rising steadily year by year (average sales price of commercial housing = sales volume of commercial housing / sales area of commercial housing). From 4681 yuan / m2 in 2009 to 2019, there is no annual decline, and it has doubled in 10 years.

Yan Yuejin, research director of think tank center of Yiju Research Institute, said that in October 2019, the average price of commercial housing nationwide was 9337 yuan / m2. The main feature of the national house price in 2019 is that the house price has stepped out of the ranks of 8000 yuan and officially entered the 9000 yuan ladder. With the high-end projects entering the market, the price is also easy to rise and difficult to fall. However, some real estate enterprises are obviously tightening their capital at present, and some enterprises will adopt the sales strategy of price for volume.

Of course, doubling in the past ten years is not a big increase. During the same period (2009-2018), Chinas GDP increased by 158%, and the per capita disposable income of the whole country increased by 156.6%.

At first glance, the 10-year growth rate of the national average house price is lower than that of GDP and residents income. However, Chinas real estate market is very regional. The growth rate of house price in hot cities is far higher than that in non hot cities, and the growth rate in ten years is up to several times.

This is also the reason why some hot cities in China pay more attention to the purchase of real estate than to the rent. For some speculative investment needs, their purchase of real estate does not care about the short-term rent, but more about the value-added of real estate in the next few years.

Compared with high house prices, the rental income of many cities in China does not seem to be ideal. Moreover, most of the new houses purchased are in rough condition. If you want to rent them, you need to decorate them, which is time-consuming and labor-consuming. It is better to sell them in rough condition in idle years.

The idleness of these houses objectively reduces the number of potential houses that can be rented out by a city, increases the contradiction between supply and demand in the local rental market, and then affects the change of rent.

In December last year, according to the 2017 China urban housing vacancy analysis released by the China family finance investigation and research center of Southwest University of Finance and economics, the vacancy rates in Chinas urban areas in 2011, 2013 and 2015 were 18.4%, 19.5% and 20.6% respectively, showing a gradual upward trend. By 2017, the vacancy rate of housing in urban areas in China has reached 21.4%. There are 65 million vacant housing in urban areas in China. The vacancy rate of housing in second and third tier cities is higher than that in first tier cities.

Gan Li, director of China Household Finance Survey and Research Center, said that from the perspective of international comparison, Chinas housing vacancy rate is still at a high level, so we should study and formulate vacancy tax and real estate tax to help invigorate the existing housing and reduce the vacancy rate.

Although not all of the above data are accepted by the industry, it has gradually become a consensus to activate the stock housing to alleviate the contradiction between housing supply and demand.

Last October, Chou Baoxing, former Vice Minister of the State Council and the Ministry of housing and housing, suggested that in order to rationally curb and gradually scale the real estate bubble, we should take the lead in introducing consumption tax, turnover tax and vacant tax that can accurately curb speculation, and then consider the property tax calmly.

However, it will take some time to activate the vacant housing by adjusting the tax revenue. According to the principle of statutory taxation, if new taxes are to be levied in the future, the corresponding laws shall be formulated through the National Peoples Congress and its Standing Committee. The so-called vacancy tax did not appear in the five-year legislative plan of the Standing Committee of the 13th National Peoples Congress. This also means that, if there is no accident, at least by 2023, the vacancy tax will not enter the legislative agenda of the NPC.

Even if we try to activate the stock houses by means of Taxation, it doesnt mean that these houses will enter into the market of sale or lease in time. The income level is the most important consideration for these homeowners to make decisions.

Is the rent too low or too high

Nowadays, most cities in China have low rental sales ratio data, which indicates that either the domestic rent is low or the house price is high. In the current situation, compared with the income of residents, the rent in domestic hot cities is not cheap. According to Zhuges house finding report, from the data point of view, the first tier cities cant afford to buy or rent, and most of the expenditures of Chinese residents go to the landlords.

Taking the price of one bedroom as a reference, the rental income ratio of North, Shanghai and Shenzhen is 89.5%, 82.5% and 78.1% respectively, which is still high; the rental income ratio of joint tenancy is 46.2%, 43% and 37.6% respectively, that is to say, even if the housing mode of joint tenancy is selected, the rental cost of North, Shanghai and Shenzhen is also more than 30% of the income.

Some second tier cities also have the pressure of renting houses. For example, Dalian, Xian, Hangzhou, Chengdu and other hot second tier cities, the income ratio of the whole rent to the first residence is more than 50%, and the income ratio of the joint rent is also at a high level.

In addition to the small seasonal rental peak, in recent years, the introduction of talents in hot cities has increased, the threshold for settlement has decreased, the attraction of population has further increased, and the inflow of population has led to the increase of demand for rental housing. For example, in recent two years, the high-tech industries in Xian, Hangzhou and Chengdu have continued to develop, attracting more and more foreign employees and increasing the cost of renting houses.

In view of the problems of difficult and expensive rental housing in these cities, the central ministries and commissions try to improve the consumption environment of rental housing through the guidance effect of financial support, and accelerate the formation of the pattern of rent and purchase simultaneously.

In July this year, the Ministry of Finance and the Ministry of housing and urban rural development jointly issued a notice that 16 cities, including Beijing, Shanghai, Nanjing, Hangzhou, Guangzhou, Shenzhen, Chongqing and Chengdu, will enter the pilot range of housing rental market development supported by the central finance in 2019, and the central finance will provide subsidies according to the size of the city. Among them, one billion yuan per year is for municipalities directly under the central government, 800 million yuan per year for provincial capital cities and cities specifically designated in the plan, and 600 million yuan per year for prefecture level cities. The pilot demonstration period is three years.

In other words, the total amount of subsidy for the above 16 cities in one year will reach 13.4 billion yuan, or 40.2 billion yuan in three years. According to the relevant programs, these funds can be used to raise rental housing resources through multiple channels, build rental information service and supervision platform and other expenditures related to the development of the rental market.

The health of the leasing market is an important part of the health of the real estate market. Only when the leasing market is stable can the sales market be stable. There are some problems in the current leasing market, but with the attention of the policy, the stability of the leasing market can be expected. Zhang Dawei, chief analyst of Zhongyuan Real estate, said.

Source: First Financial Editor: Guo Chenqi, nbj9931