The central government's latest recognition of the property industry's significance will accelerate the implementation of the real estate financing coordination mechanism as well as bring about more measures from local governments
Amid the real estate industry's recovery, a financing coordination mechanism is essential for the timely delivery of property projects, and the market calls for more accurate optimization measures from local governments, experts said.
During an inspection tour on Saturday and Sunday to understand the real estate market in Zhengzhou, capital of Central China's Henan province, Vice-Premier He Lifeng said active financing support should be extended to compliant real estate projects to ensure that homes are delivered on time, which will help protect buyers' legitimate rights and interests.
Also a member of the Political Bureau of the Communist Party of China Central Committee, He said the delivery of good-quality homes on time will help stabilize expectations and promote the steady and healthy development of the real estate market.
"The vice-premier's remarks fully reflect the great significance the central government attaches to the property market. They will help address financing difficulties plaguing real estate enterprises and will better facilitate property projects' delivery," said Chen Sheng, president of the China Real Estate Data Academy.
Chen said that local governments' measures to ensure the property market's stable development are also important for the nation's efforts to form a new and healthy real estate development pattern.
He said a "white list" mechanism for real estate projects should be optimized so that compliant projects on the list can access funding with ease.
"For projects in the white list, financial institutions should optimize the loan approval and disbursement process, speed up lending, and support the completion of projects."
Lu Wenxi, a market analyst with Centaline Shanghai, said it is expected the vice-premier's inspection tour will accelerate work on the white lists.
"Currently, the white lists from local levels are still at various stages of progress as various criteria are involved. Chinese real estate enterprises are under tremendous pressure. Once the projects on the white lists start receiving loans, these property companies' financial difficulties will likely be alleviated," said Lu.
Hui Jianqiang, head of research at Beijing Zhongfang-Yanxie Technology Service Ltd, said the vice-premier's statement is in line with the spirit of the two sessions and major measures suggested by the central government to improve the property market.
"Although a recovery was seen in the spring sales in some Chinese cities, the sector needs more support. Therefore, relevant organizations are calling for the implementation of measures mooted by the central government at an accelerated pace," Hui said.
Agreed Yan Yuejin, director of Shanghai-based E-house China Research and Development Institution. "Local governments have been urged to formulate more policies that suit their specific conditions."
The real estate industry is linked with quite a few other industries as well as overall social development. Policies introduced by local governments will be more precise and better address the needs of a specific city, he said.
