Behind the dissimilation of rent loan: long-term rental apartment is difficult to get off the hook

category:Finance
 Behind the dissimilation of rent loan: long-term rental apartment is difficult to get off the hook


This theory stems from the fact that eggshell tenants who once chose to pay monthly are facing the problem of rent loan. That is, after the rental service is suspended due to the default of the apartment, the creditors right and debt relationship between the tenant and the financial institution will not be affected in law, which means that the rent loan user will bear double rent pressure during the loan contract period. As a result, rent loan, a credit product, has almost become a rat in the street. Even many rights protecting tenants demand that the financial institutions providing rent loans be responsible for the rupture of the eggshell capital chain.

Financial institutions can not help but complain about this. According to a financial practitioner, rent loan can be regarded as a high-quality consumer credit scenario in terms of repayment sources and risk dispersion. It has repeatedly become a legacy of the collapse of long-term apartments. The fundamental reason is that some rental loan products have already been alienated from consumer credit products into financing tools.

In fact, the operators of long-term rental apartments with light assets such as eggshell and Qingke are also known as second landlords. Their original business model is to sign long-term contracts with landlords for 5 to 10 years, lock in the reduced rent and stable housing supply, and then lease the house to the tenant after decoration and partition. The term of the tenant contract is usually one year, and the rent paid by the tenant is the same as that paid to the house The price difference between Easts rents, that is, the rent difference, constitutes the main income source of long-term apartment operators.

However, the actual situation is that second landlords do not hesitate to raise the house price in order to compete for housing resources, resulting in a small rent difference or even upside down, so they have to rely on mismatched rental loans to fill the cash flow gap.

It should be noted that there are also long-term rental apartment operators with heavy asset model, such as Longhu Guanyu, which owns real estate under the real estate company. All the operators mentioned in this paper are light asset mode operators.

origin

According to the previous practitioners impression, before 2017, the demand of rental housing market was greater than the supply, and the supply of housing acquisition market was greater than the demand. The rental agency was able to stabilize the price difference between the house price and the rent - until the arrival of the catfish of long-term rental apartments. When they (the long-term apartment operators) came in, the markets closing prices went up. He said that owners have more choices. Some smart owners will even pull several intermediaries into a group and the one with the highest price will get it in the way of auction.

High price is often a long-term apartment operator with capital support. According to the statistics of it orange, in 2017, the long-term rental apartment benefited from the favorable policies and became an investment outlet. The total financing amount of the whole year reached 32425.5 billion yuan, an increase of 199% over the previous year. In 2018, the data continued to increase to 8.28 billion yuan.

After the injection of funds, the scale of long-term apartments has expanded rapidly. In just two years, the number of houses managed by head operators has risen to 100000, which is a hundred times higher than that in 2015.

Such an efficient rate of house collection also lays a hidden danger of high collection and low rent for the long-term rental industry. Due to the high cost of a large number of houses hoarded by high rent and low rent, the lock-in period of these houses is as long as 5-10 years, which is equivalent to locking the fixed cost of long-term rental apartments at a higher level in the market in disguise. On the income side, the rent fluctuates with the market fundamentals and has great uncertainty.

According to the historical data, it is difficult for the rental income of long-term rental apartments to cover the cost. Taking eggshell apartment as an example, the rental cost in 2017, 2018 and 2019 accounted for 77.9%, 81.2% and 89.8% of revenue respectively. After deducting the rent cost, the small profit margin is not enough to cover other operating costs. Financial data show that the operating cost of eggshell apartment accounts for 144.2% of revenue in 2019, even if excluding the costs not directly related to the scale of operating housing, the proportion is still as high as 108.88%.

This means that if there is no external capital supplement, the long-term rental apartment will maintain its operation under the existing scale, and its working capital will be drained rapidly. If the past operating efficiency is maintained for expansion, it will fall into a cycle of larger scale and more losses.

Under the dilemma, long-term apartments usually choose to continue to expand, and the ultimate purpose of scale expansion is to seek external funds to supplement the operating cash flow gap.

According to the annual report of eggshell apartment, the external capital sources of the long-term rental industry are mainly strategic investment funds, bank loans and rent loans. Wang Gehong, CEO of Xinpai apartment, once said in an interview that the investment policy only depends on the scale of the long-term apartment, not on the geographical layout, the payment ability of the tenants and the brand influence. The lack of valuation elements has also prompted the long-term apartment to indulge in the development mode of King by scale. Hu Jinghui, the former co-founder of my love family, also said that the model of long-term rental apartments is not TOC, nor tob, but tovc..

As you can imagine, the long-term rental apartment was kidnapped in the rampant expansion of this chariot.

Industry insiders believe that if the economic environment is better, the rent rises, or the operation time is long enough, and the subsequent housing price returns to rationality and smooth the cost, the long-term rental apartment may usher in the dawn. However, under the shadow of the epidemic, the vacancy rate and default rate have both increased, and the long-term rental industry is hard to see. Two long-term apartments, eggshell and Qingke, which have been successfully listed in the United States, have both collapsed this year.

The rent loan is between the tenant and the bank. A parent rents an apartment before the employee thinks.

Only from the legal point of view, it is true. Meng Bo, a lawyer from Beijing Jingshi law firm, explained that the legal relations involved in the rent loan include: the legal relationship between the long-term apartment and the owner of the house, the legal relationship between the sublease of the long-term apartment and the lessee, and the loan legal relationship between the lessee and the financial platform. If the first two legal relations have problems, or after the dissolution, the third legal relationship will not be dissolved. Therefore, after the long-term apartment defaults on the homeowner, the tenant may face the situation of homelessness, and also have to repay the loan to the financial institutions on schedule.

From the perspective of risk control, there is no blame for the rent loan. According to Bai Wenxi, chief economist of IPG China, first of all, the rent loan has a clear repayment source, that is, the rent paid by the tenant; secondly, the credit subject of the rent loan is the tenant, which is sufficiently dispersed, the risk of risk dispersion is high, and the risk of large-scale default is small. There is no problem in financial logic for such a credit scenario.

At present, our substantial sources of funding include advances from financial institutions related to rent financing and advances from residents. Eggshell apartment said in the 2019 annual report that the advance payment of financial institutions related to rent financing refers to the rent loan. According to the annual report, rental loans account for more than half of the financing sources of eggshell apartments in 2019.

In addition, 91.3%, 75.8% and 65.9% of eggshell apartment tenants used rental loans in 2017, 2018 and 2019. As of the end of 2019, 62.6% of the young guest apartments have used rental loans. According to the market research results, only 30% of the tenants have a real demand for rent loans.

The credit risk of financial institutions has actually shifted from tenants as credit subjects to long-term rental apartments as loan assistance institutions. One financial practitioner said.

Long term apartments also hoped to develop other financing channels to reduce dependence on rental loans. In January 2017, Rubiks cube apartment issued the first asset securitization (ABS) product in the long-term rental industry, with a total issuance amount of 350 million yuan. The underlying assets are expected rental income and rent loan, and the free and equal long-term rental apartments have also followed suit. However, after 2018, runaway and thunderstorm events have completely destroyed the market credit of the long-term rental industry, and such ABS products have gradually disappeared.

This also has something to do with the fact that long-term apartments themselves are not profitable. Bai Wenxi said that the cash flow of long-term rental apartments has been unable to turn positive, which is difficult to meet the needs of ABS investors.

The first mock exam of another ABS is that the core issue of long rental apartments is renting loans. The underlying nature of the long rental apartments is the same as the rent loan, which is the credit risk mismatch, which means that the white handed wolf is the only one. Most of the overseas apartments issue asset securitization products based on their own property rights. However, the domestic second landlords who adopt the asset light operation mode do not have self-sustaining property rights and lend ABS with rent. Their financing credit subjects have changed from leasing institutions to tenants. What else should we talk about financing?

As business risks begin to expose, capital tends to be cautious, and financing channels are becoming less and less. Rent loan has almost become the last choice for long-term rental apartments, and the financial institutions still in the bureau have inadvertently become the supplier of long-term rental apartments.

In fact, since 2018, the cash flow crisis in the long-term rental industry began to surface. Ping An Bank, China Merchants Bank and other major banks have successively pressed the pause button on rental loans, but there are still many financial institutions involved. According to the annual report of Qingke apartment, it has established cooperation with 11 financial institutions, including Shanghai Huarui bank, e-commerce bank and other private banks. The eggshell storm will also be the main partner micro banks involved in it.

There are also rental loan products designed by state-owned banks, which can bypass the second landlord directly to the owners. In 2017, China Construction Bank took the lead in launching the countrys first personal housing rental loan product housing loan. It is understood that after the loan application is successful, the loan will be directly allocated to the landlord through the self built leasing platform of CCB, which will not form fund precipitation at the intermediary.

A few days ago, I love that my family will take over the eggshell market rumors quickly ferment, causing capital market changes. However, a person familiar with the matter told the securities times securities firm China reporter that the eggshell apartment has a huge fund gap and its total exposure may reach 10 billion yuan. Many potential investors are reluctant to accept this hot potato after preliminary contact.

There are precedents for this approach. The reporter learned from an owner that in the first half of this year, Qingke apartment, which had difficulty in capital operation, transferred part of its housing resources to Jianrong home under CCB, including those entrusted by him to Qingke. At present, the owner has signed a new contract with Jianrong Jiayuan.

It is worth noting that the long-term rental industry regulatory norms that the market is looking forward to is already on the way. On September 8, this year, the Ministry of housing and urban rural development issued the housing rental regulations (Draft) to include the rent loan of long-term rental apartments into the regulatory scope, support the municipal governments directly under the central government and divided into districts to establish a housing rental fund supervision system, and proposed to broaden the financing channels of the long-term rental industry, including supporting the development of real estate investment trust funds and supporting housing rental enterprises to issue corporate bonds Corporate bonds, non-financial corporate debt financing tools and other corporate credit bonds and asset-backed securities are specially used for the development of Housing leasing business.

Yin Zhentao, director of the financial science and Technology Research Office of the Institute of finance, Chinese Academy of Social Sciences, said that most of the regulatory documents that have been issued are departmental rules of local governments, targeting at long-term rental apartments rather than financial institutions, such as the risk prevention and control fund model launched in some regions, or have an impact on the normal business operation of enterprises.

It may be more effective to regulate the long-term rental industry from the perspective of financial supervision, but it also needs multi-sector linkage. He said that, in fact, the rent loan model is more similar to the loan assistance model. This business model has an example in financial regulatory policies, so the main problem now is how to implement it.

In this regard, he suggested that, first of all, financial institutions should carry out risk control on the qualification of the scene party and select compliant and legal institutions; second, the relationship between the rights, responsibilities and interests of both parties should be clear, and the process should be strictly controlled; finally, the problems of special funds for special purposes and fund security should not be used to misappropriate customer funds or adopt bank custody. Industry and commerce law enforcement departments can limit the number of charging periods.

At present, many local governments have set up a joint work rectification group, led by the Bureau of housing and urban rural development, with the cooperation of relevant departments, to investigate the situation of rent loan business carried out by intermediary agencies of long-term rental apartments in their jurisdiction, as well as the scale of rent loans involved. A local financial regulatory Research Institute said.

He believes that low - and middle-income consumers have real demand for rent loans. In the future, rent loans should not be completely banned, but will be rectified and standardized on the basis of stock, especially to strengthen rent account supervision and real-time monitoring of capital flow.

It is necessary to completely overthrow the current situation of the industry that uses rent loan leverage to compete for scale, and return to the business model of eating rent difference. Only in this way can the industry have the possibility of healthy and sustainable development. Otherwise, there will be no future for the industry, he said