The real estate industry is about to sound the charge for "stabilizing after a decline."

Recently, there have been signs of a warming real estate market in Beijing, Shanghai, Guangzhou, and Shenzhen. Additionally, some institutions have published articles stating, "It is expected that housing prices will stabilize after a decline in 2024."

For the real estate market to stabilize after a decline, the market is one aspect, and properly handling the "housing delivery" work is even more critical and important. The real estate financing "white list" mechanism plays a very key role as the "funds lifeblood" in this process.

A few days ago, the Ministry of Housing and Urban-Rural Development and the Financial Regulatory General Bureau jointly held a national video conference to promote housing delivery work, guiding various regions to further leverage the role of the urban real estate financing coordination mechanism, to solidly advance housing delivery work, and to promote the stabilization of the real estate market.

The conference emphasized that ensuring housing delivery is an important task in promoting the stable and healthy development of the real estate market. It is a concrete action that adheres to the people-centered development philosophy and responds to the concerns of the public. It is also a strong measure to prevent and resolve real estate risks and promote the stabilization of the real estate market.

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"The current period is an important opportunity to do a good job in all aspects of real estate," the conference stated. "The 'national-provincial-city' three-level special teams should work together to promote work, strive to solve the main problems that arise in the battle to ensure housing delivery, expand the effectiveness of the urban real estate financing coordination, and accelerate the judicial disposal of projects with insufficient funds to cover debts. We must focus on the target and go all out to complete the annual delivery task."

Specifically, it is necessary to increase the scrutiny, promotion, problem project repair, and loan distribution of "white list" projects to truly meet the reasonable financing needs of real estate projects. Further promote the "expansion and effectiveness" of the coordination mechanism, expand the coverage of the "white list," ensure that compliant real estate projects "should enter as much as possible," and promptly include approved "white list" projects into the ledger and system management.

As soon as the words were spoken, governments in various places issued a package of policies to fight the battle of expanding the "white list" and ensuring housing delivery.

On October 11, the Office of the Financial Committee of the Heilongjiang Provincial Committee of the Communist Party of China issued a "Notice on Publicly Soliciting Opinions and Suggestions," announcing the launch of a battle to expand the scope and increase the quantity of real estate "white list" projects to ensure "should enter as much as possible, should lend as much as possible."

On October 10, Shandong Province issued a "Notice on Implementing Financial Support Policies to Promote the Stabilization of the Provincial Real Estate Market," which will fully play the important role of the real estate financing coordination mechanism, increase the promotion and loan distribution of "white list" projects, truly meet the reasonable financing needs of real estate projects, support the battle to ensure housing delivery, and effectively promote the stabilization of the real estate market."The stabilization of the real estate market is not solely achieved by stimulating demand to increase volume; more importantly, it involves safeguarding the rights and interests of homebuyers. Ensuring the delivery of homes is crucial for market stabilization, which requires policy efforts from both the supply and demand sides," said Li Yujia, Chief Researcher at the Guangdong Housing Policy Research Center.

The financing of real estate projects is inherently complex, with intricate financial arrangements between the headquarters of real estate companies, city companies, and project companies, which exceed the limitations of local government industry management based on administrative boundaries.

Li Yujia stated that this necessitates strengthening the coordination and joint efforts at the "national-provincial-city" three-tiered task force to address issues arising from the battle for affordable housing, particularly in solidifying the primary responsibility of real estate companies to ensure home delivery. In the process of promoting asset disposal, judicial disposal, and the revitalization of existing stock, it is also necessary to coordinate the efforts of judicial departments, local governments, and financial institutions.

Recently, Lu Ting, Chief China Economist at Nomura Securities, also expounded on the importance of ensuring home delivery at the 2024 Boao Real Estate Forum.

He said that the most critical issue regarding the real estate market's downturn over several years is "clearing out". What sets our country apart from others is the existence of a large number of home delivery issues, making clearing out particularly important. Addressing the home delivery issue is not only a matter of the government and developers fulfilling their responsibilities but also a crucial step in rebuilding the market's confidence in developers and regulatory oversight.

So far this year, various regions have actively utilized urban financing coordination mechanisms, with considerable progress made.

By the end of August, Deputy Minister of Housing and Urban-Rural Development Dong Jianguo reported that the Ministry of Housing and Urban-Rural Development has established a national, provincial, and city three-tiered coordination mechanism. Commercial banks have approved more than 5,300 "whitelist" projects according to the approval procedures, involving loan amounts close to 1.4 trillion yuan. These loan funds are being gradually disbursed based on the project's construction progress to ensure smooth project delivery.

He also stated that the Ministry of Housing and Urban-Rural Development and the Financial Regulatory General Bureau have conducted a comprehensive investigation of under-construction and unsold commercial housing projects nationwide, identifying 3.96 million housing units contracted to be delivered by the end of this year, which are the main targets of the battle.

At the same time, they have been implementing "one project, one policy" for classified disposal, guiding localities to adopt a "one project, one plan, one task force, one bank, one audit, one judge" disposal model. For projects with insufficient assets to cover debts, they are accelerating the bankruptcy reorganization or liquidation of project development companies, and in accordance with the Supreme People's Court's regulations on the order of debt repayment, they prioritize the protection of homebuyers' legitimate rights and interests.

Major financial institutions are also accelerating their actions. According to incomplete statistics, so far this year, state-owned banks such as Industrial and Commercial Bank of China, Agricultural Bank of China, Bank of China, and China Construction Bank have taken the lead in expressing their stance. Joint-stock banks such as Industrial Bank, China Merchants Bank, Everbright Bank, CITIC Bank, Shanghai Pudong Development Bank, and China Zheshang Bank have also successively held special meetings on urban real estate financing coordination mechanisms.Bank of China stated that as of September 18th, it has successfully approved nearly 600 "whitelist" projects, providing financing amounts exceeding 130 billion yuan. China Construction Bank reported that by the end of August, the bank's coordination mechanism had more than 600 whitelist projects, with approved amounts exceeding 130 billion yuan. China Zheshang Bank announced that it has approved credit for "whitelist" projects totaling approximately 32.3 billion yuan.

Currently, it is an important opportunity period for carrying out various real estate tasks. From the warming up of sales in first-tier cities to the valuation repair in the capital market, coupled with policy assistance to corporate cash flows, these have created favorable external conditions for ensuring the delivery of housing.

Li Yujia indicated that from the project's entry into the whitelist to credit approval, and ultimately to loan disbursement and meeting funding needs, this is a crucial link in promoting the delivery of housing. Recently, the real estate market has shown signs of recovery, and the capital market has begun to repair valuations, creating conditions for the implementation of the whitelist. Taking advantage of the current favorable external environment, synchronizing project promotion and problem repair, and incorporating more projects into the whitelist, seizing the best market opportunity for ensuring the delivery of housing, can promote the simultaneous improvement of housing delivery and the commercial housing market.