Market is Slowing Down? 市场增速放缓？

By T.K.

Recently, media reported that many projects are slashing selling prices to boost sales volume. Among the reported cases, names of big national developers were also been seen. Price cuts in Hangzhou and Changzhou were mostly reported. Analysis pointed out that the high inventory levels in the cities have caused the price cuts. Looking into the data.

The rumor on this is because of the high inventory in Hangzhou. According to industry data provided by Soufun, since Feb 2014, the inventory period level (the average months to clear the inventory in the city) has been surged to over 30 months from the average of 18 months in 2013. This implied that, based on the recent monthly sales volume, it takes 30 month sell all the units available in Hangzhou, not taking into account of any upcoming projects. The data also reflected since Feb 2014, the sales in Hangzhou have been slowed down, compared to 2013.

Why the long inventory period matters? This is because developers usually quite heavily leveraged on developing projects, especially developers with smaller scales, as they will be more difficult to get financing facilities from the banks. Even if funds are available, the cost will be higher than the national rivals. Hence it makes sense if small developers to cut the price for cashing in to repay the loan. However, Vanke, one of the top developers In China, has been also reported joined the price cutting party. It makes no sense for such large player to do so. Hence, it is believed the developer was trying to draw some media coverage and public attentions.
Actually, the latest national data suggested there are slowing down in both the sales volume and selling prices. According to the National Bureau of Statistics (NBS), the total residential area sold in the first two months in 2014 was declined 1% from a year earlier. While in the same period in 2013, a large annual increment of 55% was recorded. In addition, among 70 cities tracked by the NSB, there are fewer cities recorded price increase in Jan and Feb, despite there are still some 50 cities recorded increase in price.

From all the above, it seemed that the market is really slowing down from a year before. However, it is believed the end-user demand in the country is still substantial, why would this happen? We believe it is attributable to two major factors.

The first one is the tightening in mortgages. It has been widely reported that the discounts offered by banks for first home mortgages have been stopped almost in all cities. In addition, the interest rates have also been upward adjusted. Insiders of the industry told us that this was partially due to the tightening liquidity as well as the orders given by the headquarters.

The second factor is the policy directed from the central government, which is to exert control to curb the rapid increase in property price. In the recent “two sessions”, senior officials have revealed the central government will take “two way” approach on property market control. The “two way” can be interpreted as to curb the overheating market and at simultaneously to provide support to the end-users, such as to increase supply for public housings.

The two factors increased the difficulties for buyers to enter the market. For some affordable buyers, many of them are taking the wait-and-see approach before taking action. Seemed leading developers have noted the situation earlier, many of them have pointed out that the growth in the market are normalized and cannot continue the exponential growth in the past few years. In conclusion, it is highly possible that the property market will grow in a slower pace this year.

近日不少媒体报道，很多楼盘都大幅削价以刺激销量，也包括全国性开发商的楼盘。杭州和常州的降价受到广泛报道。有分析指是这些城市的高库存水平引至降价。那么我们也来看看数据。

传言说杭州的库存居高不下。根据搜房的行业数据，杭州的库存周期水平（按月计算以完全消化这城市的库存）由2013年18个月的平均水平飙升至2014年2月的30个月。这意味着，以在最近的月销量计，所有在杭州可以出售的单位可以卖30个月，还没把即将开售的楼盘计算在内。数据也反映了自2014年2月开始，杭州的销量已经比2013年放缓。

为什么存货周期长会令开发商减价？理由是，开发商通常是以高杠杆开发项目，尤其是规模较小的开发商，因为他们较难以从银行获得融资。即使资金到手，他们的成本也会比全国性的对手要高。因此，小开发商降价的兑现以偿还贷款是很容易理解的。不过，如万科这种国内顶尖的开发商业也大幅降价，实在令人摸不着头脑。很可能是想以此吸引一下眼球罢了。

事实上，国家最新数据也表明销量和售价的放缓。据国家统计局 ，2014年首两个月的售住宅总面积较去年同期下降了1 ％ 。而在2013年同期，则有着55％的大幅度增长。此外，统计局的70个房价指数也显示出，在一月和二月，虽然仍有50多个城市的房价在上涨，但这个数字以较去年下降。

从以上各种迹象，似乎房地产市场真的比一年前增长放缓。但是在大家都仍然认为国家还有大量的刚性需求，那为什么会出现这种情况？我们相信这是由于以下两个主要因素。

第一是按揭的收紧。不少报道指出，银行对首套房按揭贷款提供的优惠已几乎在所有城市绝迹。此外，房贷的利率也已上调。业内人士告诉我们，部分的原因是由于流动性收紧，还有部分的原因是来自总部下发的指令。

第二个因素是中央政府的政策导向。政府希望透过政策以遏制房地产价格的快速增长。在最近的“两会”，官员透露了中央政府将采取“双向调控”的方式应对房地产市场。 “双向调控”可以解释为遏制过热的市场，并同时对刚需用户提供支持，如增加供应及建设保障房。

这两个因素增加了购房者进入市场的难度。对于一些有经济实力的买家，多数会是采取静观其变的态度。似乎不少领先的开发商早就注意到这情况，他们早前指出，市场的增长将回归正常化，并不会出现过去几年的高速增长。总之，今年的房地产市场发展可能比去年放缓。

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