Rent loan into a rat on the street? Long term rental apartment riding tiger hard financial institutions crying for injustice

category:Finance
 Rent loan into a rat on the street? Long term rental apartment riding tiger hard financial institutions crying for injustice


Recently, there are more people renting. Today, six people come to see the house. Many of them are refugees who are ready to flee eggshells, an intermediary told Chinas brokerage. When these people are looking for a house again, they are still in fear when they meet the monthly payment conditions again. At this time, the intermediary will quickly emphasize that dont worry, its not a rent loan..

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. Therefore, rent loan, a credit product, has 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. A financial practitioner pointed out that the 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 the rent loan has long been alienated from consumer credit products into a financing tool.

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 a long-term contract with the landlord for five to ten 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 equal to that paid by the tenant The price difference between landlords 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 price of the house 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 and drink dove to quench their thirst.

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

We used to take a suite and draw out a few rooms on the floor with a ruler. A leasing industry practitioner described to the Chinese reporter of a securities firm the grand scene of the rental market a few years ago. Tenants lined up one by one, and we said to him, here is the bed, here is the table. Do you want to rent it? He doesnt rent. There are people who rent in the back.

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 these long-term rental apartment operators 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.

According to the historical data, the rental income of long-term apartments can not 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 working capital of the long-term apartment will be drained rapidly if it maintains the existing scale. However, if the operation efficiency is maintained in the past, it will fall into a cycle of larger scale and more losses.

Under the dilemma, the choice of long-term rental apartment is 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..

It can be imagined that the long-term rental apartment has been kidnapped in the crazy expansion of this chariot, which is difficult to get off.

If the economic environment is good, the rent rises, or the operation time is long enough, 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. Only two or two long-term apartments, eggshell and Qingke, which have successfully listed in the United States, have both collapsed this year.

With the frequent outbreak of the long-term apartment crisis, disputes about rent loans are also rising. The rent loan is between the tenant and the bank. The former employee of a long-term rental apartment thinks that.

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 with such a credit scenario in terms of financial logic.

However, in reality, the rent loan, which is supposed to meet the needs of tenants consumption credit, has long been alienated as the main financing tool of long-term apartment, and long-term rental apartment is the real urgent demand side of rent loan.

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 annual report of 2019 that the advance payment of financial institutions related to rent financing refers to rent loan, and the rental loan accounts for more than half of the financing sources in 2019.

In addition, 8.65% and 9.65% of the total rentals in 2017, and in the year of 2018, 9.65% and 9.75% of the renters in the year of 2018 were used. Qingke apartment is no exception. By the end of 2019, 62.6% of youth apartment tenants 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.

With the exposure of business risks, the capital tends to be cautious, and the financing channels are becoming less and less. The rental loan has almost become the last choice for the long-term rental apartment, which remains in the financial institutions of the Bureau, and has become the supplier of the long-term rental apartment.

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 Chinas securities dealers that the fund gap of eggshell apartment is huge, and the total exposure may reach 10 billion yuan. After preliminary contact, many potential investors are reluctant to accept this hot potato.

The only result of eggshell may be to clean up valuable assets and find other enterprises to take over. Bai Wenxi judged that for any company, there are great concerns about directly undertaking the eggshell apartment as a whole. However, if the creditors rights and debts formed by the house collection agreement and the rental contract are cleared up, the contractor may be found.

There are precedents for this approach. According to an owner of the securities company, in the first half of this year, Qingke apartment, which has 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 home.

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.

He suggested that, firstly, financial institutions should conduct risk control on the qualification of scene parties and select compliant and legal institutions. Secondly, the relationship between the rights, responsibilities and interests of both parties should be clear, and the process should be strictly controlled. Finally, the special funds and fund security issues should not be misappropriated, or the bank deposit method should be adopted. The law enforcement departments for Industry and commerce 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, so that the industry can have the possibility of healthy and sustainable development. Bo Wenxi said, otherwise, the industry has no future. Source: Securities Companies in China Author: Du Xiaotong, editor in charge: Zhong Qiming_ NF5619

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, so that the industry can have the possibility of healthy and sustainable development. Bo Wenxi said, otherwise, the industry has no future.