Ministry of Finance: Strengthen the connection between new and old policies, promote the real estate market to stop falling and stabilize!

2024-11-20 13:43:17

On October 12th, the State Council Information Office held a press conference, where Minister of Finance Lan Fo'an, Deputy Minister of Finance Liao Min, and others introduced the relevant situation of "increasing the countercyclical adjustment of fiscal policy and promoting high-quality economic development", and answered questions from reporters.

At the meeting, it was pointed out that the Ministry of Finance will continue to strengthen the coordination between fiscal policies and other policies, enhance the linkage between the central and local governments, strengthen the connection between new and old policies, strike a combination punch, and resolutely promote the stabilization of the real estate market.

Finance Minister Lan Fo'an stated that according to the deployment of the Central Politburo meeting held on September 26, the Ministry of Finance will launch a package of targeted incremental policy measures in the near future, focusing on stabilizing growth, expanding domestic demand, and mitigating risks, on the basis of accelerating the implementation of determined policies. The main measures include the following aspects:

One is to strengthen support for local governments to resolve government debt risks, increase debt quotas on a large scale, and support local governments in resolving implicit debts. Local governments can free up more energy and financial space to promote development and protect people's livelihoods.

Second, we will issue special treasury bond to support large state-owned commercial banks to supplement core tier one capital, improve their ability to withstand risks and extend credit, and better serve the development of the real economy.

The third is to combine the use of local government special bonds, special funds, tax policies and other tools to support and promote the stabilization of the real estate market.

The fourth is to increase support and guarantee for key groups. A one-time living allowance has been provided to disadvantaged groups before the National Day holiday, and the next step will be to increase efforts to provide excellent assistance to students and improve their overall consumption ability.

He emphasized that countercyclical regulation is not just about the four points mentioned above. These four points are policies that have already entered the decision-making process, and other policy tools are also being studied.

Regarding the considerations of fiscal policy in supporting the development of the real estate market, Vice Minister of Finance Liao Min stated that the Ministry of Finance and relevant departments are working together to promote the balance of supply and demand in the real estate market, continuously optimize fiscal and tax policies, and promote the real estate industry to return to a stable and healthy development track. In the policies that have been introduced, there are three aspects: demand side, supply side, and risk mitigation:

On the demand side, the main support is to meet the diversified housing needs of residents and reduce the cost of purchasing a house, including the phased personal income tax refund policy of "selling old and buying new" to exchange for housing. These two policies have played an important role in reducing residents' housing burden and increasing housing demand.

On the supply side, the main support is to optimize the supply of affordable housing and secure the bottom line of people's livelihood. In the past three years, the central government has allocated 212.4 billion yuan in subsidies for affordable housing projects, invested 280 billion yuan from the central budget, and coordinated local government special bonds to support the raising of 6.66 million sets of various types of affordable housing to meet the basic housing needs of urban low - and middle-income groups, new citizens, and young people. At the same time, it has also supported various regions to actively and steadily promote the renovation of 160000 old residential areas, benefiting 27.25 million households, and supporting the renovation of 4.2 million shantytowns, urban villages, and dangerous old houses in cities, playing an important role in stabilizing investment, promoting consumption, and benefiting people's livelihoods.

In terms of resolving stock risks, the financial department has cooperated to introduce the "Baojiao Building" special loan policy, providing interest subsidies for 350 billion yuan of special loans. Since last year, 6.2 billion yuan of interest subsidy funds have been pre allocated to support the protection of the legitimate rights and interests of homebuyers. The Ministry of Finance also cooperates to promote the battle of ensuring the delivery of housing, digest existing commercial housing and idle land, prevent and resolve real estate risks, and stabilize social expectations.

Liao Min pointed out that in the next step, we will adhere to strict control of increment, optimize stock, improve quality, and actively study and introduce policy measures that are conducive to the stable development of the real estate industry. The Ministry of Finance has three main considerations:

Firstly, allow special bonds to be used for land reserves. This policy aims to support local governments in using special bonds to recover eligible idle and undeveloped land, which is currently relatively abundant in various regions. In areas where there is a real need, it can also be used for new land reserve projects. This policy can not only regulate the supply and demand relationship in the land market, reduce idle land, enhance the ability to regulate land supply, but also help alleviate the liquidity and debt pressure of local governments and real estate enterprises.

Secondly, support the acquisition of existing housing and optimize the supply of affordable housing. Considering the relatively large number of houses currently built for sale, we mainly adopt two support measures: one is to use special bonds to purchase existing commercial housing for use as affordable housing in various regions. Another aspect is to continue to make good use of the subsidy funds for affordable housing projects. Originally, this fund was mainly used to support the construction of affordable housing units. Now, the direction of support has been optimized and adjusted to appropriately reduce the scale of new construction and support local governments to raise more affordable housing units by digesting existing housing units. Through these two measures, we can not only digest the stock of commercial housing, promote the balance of supply and demand in the real estate market, but also optimize the supply of affordable housing to meet the housing needs of the majority of low - and middle-income groups.

Thirdly, timely optimize and improve relevant tax policies. According to the decision and deployment of the Central Committee of the Communist Party of China, the Ministry of Finance is urgently studying and clarifying the value-added tax and land value-added tax policies that are linked to the cancellation of the standards for ordinary and non ordinary residential properties. Next, the Ministry of Finance will further study and increase support, adjust and optimize relevant tax policies, and promote the stable and healthy development of the real estate market.

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