How To Balance The Pillar Of Pillar Industry

Keynes believes that the lack of effective demand is the root cause of the economic crisis, which is caused by insufficient employment, inadequate consumption and underinvestment. This has become the basic foothold of Keynes economics. From this, we also have the law of diminishing marginal propensity to consume, the law of diminishing marginal efficiency of capital, the law of flexible preference, and the gradually developed theoretical system of macroeconomics.

In fact, where there is insufficient effective demand, it is clear that revenue and budgets are not enough. People's demand is not a transaction, but demand is there. And this is the most typical example of real estate. It is not only a rigid demand in the so-called rigid demand, but also carries the magic power of "six purses", and can drive dozens of industries. Its major policies and price fluctuations often affect the hearts of millions of households.

The golden age of real estate in the last twenty years has been surging, and this industry is increasingly closely related to the national transportation and people's livelihood. This decisive role can be seen from one or two major economic policy ideas and reform directions. For example, insisting on the position of "housing instead of speculation" is to remember the initial intention of satisfying the basic housing needs of the people in the real estate field.

The central bank research group published the 2019 survey of China's urban households' assets and liabilities in the Journal of China finance. The average household assets of urban households in China were 3 million 179 thousand yuan, housing accounts for nearly 70% of household assets, and housing loans accounted for 75.9% of the total household liabilities. Yes, for families and individuals, real estate has long gone beyond the meaning of living and working, becoming the core asset and the most important sense of security or the source of anxiety. As far as the country is concerned, real estate is also a heavy tool for people's livelihood Protection, industrial transformation, fiscal reform, urban development, debt risk, financial security, public governance, and many other fundamental problems.

Therefore, it is very difficult to make responsible judgments and decisions if there are many major reform measures such as the current factor market allocation reform, the real estate investment trust fund (REITs) in the infrastructure field, and the further expansion of the financial industry's opening up.

Recently, the book "global real estate" gives some details that deserve serious consideration. In particular, a comparative analysis of the pillars of the real estate system in Britain, Japan, the United States, Germany, Singapore and other countries is conducted to examine the hidden devil and angels from a global and longer time perspective.

In the pillar of this pillar industry, the balance between housing demand and its financial attributes is the core content. In this regard, the contradictions and problems caused by the US model are the most prominent. One of the important contents of the American dream is to have decent housing. According to the book, the per capita building area of the new single family housing in the United States is 96 square meters, which is significantly higher than that of other developed countries and regions. However, the financial crisis caused by the real estate bubble burst and the subprime mortgage crisis has led to the most serious global economic crisis in human history and has affected so far. The main reason is the excessive financial nature of real estate. "Global real estate" concludes: "the global economy supports the consumption concept and habits of US residents with low savings and high debt, so as to achieve high housing consumption. At the same time, loose credit and supervision led to a large number of low down payment, low credit and low income families entering the housing market, and the demand for serious overdraft and credit risk accumulation. Compared with the international level, housing consumption in the United States has gone too far, housing prices have risen sharply, the lever level has been too high, the real estate bubble has formed, and the debt crisis is brewing.

As the most economically developed country in the world, the United States has the global technological superiority and military and financial hegemony. Moreover, it is known for its freedom of ownership and encouragement of autonomy in the land system and tax system. However, since the focus of the US housing policy gradually shifted from supply side to demand side after World War II, the government actively promoted the supply of real estate credit, reduced the credit threshold in the primary market, gained liquidity in the two tier market through mortgage securitization, and finally made the one or two level market risk linkage superposition, so that the credit risk and liquidity crisis spread from real estate to the entire financial system. And then spread and spread all over the world.

The situation in the UK is even more embarrassing than that in the United States. When the per capita housing area (38 square meters) is much lower than that in the United States, the ratio of debt to GDP in residential sector is as high as 87%, higher than that in the United States and most developed countries. In 2008, British residents accounted for more than 150% of the debt to income ratio, which was also higher than that of the United States, making it the most affected country in the subprime crisis. Fundamentally, the United Kingdom changed from a mutual housing finance system to a market oriented housing finance system in 80s.

Compared with the United States and Britain, the consequences of over financial real estate in Japan seem to be more serious. In 1991, Japan's real estate prices peaked down for 20 years, and Japan's economy fell into a "lost 20 years". According to the book, "land financial attributes are strong, and rapid bubbles in the environment of loose currency and speculative four" are important reasons. "In the 1981-1990 year, the legal entity invested in real estate with an annual average growth rate of 16.9%, far exceeding the growth rate of 8.3% of the manufacturing industry, which directly led to the real estate bubble."

"Global real estate" is highly praised by the German model and the Singapore model. On the one hand, Germany's per capita housing area has reached 46.5 square meters, and Singapore's autonomous housing ownership rate has reached 91%; on the other hand, two countries have maintained the long-term stability of housing prices. Among them, Germany's robust housing finance system, especially the housing savings and loan system, as well as the tax system that encourages residents to hold for a long time, is indispensable. The main feature of Singapore is that when the government strongly leads the land market to provide affordable housing for middle and low income, it also implements a central provident fund with a deposit ratio of up to 37% (10% of the data in Hongkong and 20% in the mainland of China) and a high tax on non self housing. There are two common characteristics of the two modes. One is to curb excessive financial performance of real estate, two is to use the two mechanisms of the government and the market more steadily. Obviously, this is what the author of this book advocates for reference.

Personally, the structural reform led by supply side reform is not only a reference to some model, but will absorb and learn from each country's pillar system superiority in this pillar industry under the background of reducing housing finance and housing supply. For example, in the United States, the mainstream REITs and so on.

As mentioned earlier, the state's overall economic policy ideas and the positioning of the real estate industry have been greatly adjusted. With these changes, the past experience is likely to be completely out of order, so we should be more vigilant against the story of soaring housing prices and the illusion of real estate that is not acceptable. Because in the global perspective and in the 75 years after the war, real estate has become a pillar industry in China in the past 20 years, and it is only a half way to rebalance its system.

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