"Housing provident fund can be used as down payment" is becoming one of the contents in the policy toolbox of local property markets.
According to the incomplete statistics of The Paper, up to now, at least over 20 cities including Qingdao, Guangdong Meizhou, Meishan, Fujian Xiamen, Mianyang, Liaoning Shenyang, Zunyi, Sichuan Ziyang, Shanwei, Guangdong Zhuhai, Quanzhou, Nanping, Zhangzhou, Chaozhou, Huizhou, Zhongshan, Longyan, Ya ‘an, Anhui Chizhou, Lu ‘an and Huainan have mentioned that they can withdraw their provident funds.
Take Meizhou, Guangdong Province as an example. Recently, Meizhou Housing Provident Fund Management Center announced the Implementation Rules for Employees to Withdraw Housing Provident Fund as Down Payment for House Purchase, which clarified that employees and their spouses who have paid in Meizhou City to purchase commercial housing (or second-hand houses) within the administrative area of this city, and signed a house purchase contract with real estate enterprises (or handled the transfer formalities of immovable property certificate with the seller) but have not paid the down payment in full, they can withdraw the provident fund as down payment.
Taking Qingdao, Shandong Province as an example, on August 31 this year, Qingdao Housing Provident Fund Management Center issued a notice on supporting employees to withdraw housing provident fund to pay the down payment for house purchase, which clearly stated that if they purchase new commercial houses within the administrative area of Qingdao, they can apply for withdrawing the housing provident fund under the names of the buyers and their spouses to pay the down payment for house purchase. At the same time, the scope of the above-mentioned policies will be relaxed in stages. If the first family self-occupied house is purchased within one year from the effective date of this notice, the purchaser and his immediate family members will be supported to withdraw the housing provident fund to pay the down payment for the house purchase. The policy relaxation is valid from September 1, 2022 to August 31, 2023.
After the implementation of the New Deal, the effectiveness of the policy began to appear. According to the data disclosed by Qingdao Housing Provident Fund Management Center on October 8, since the implementation of the new policy of withdrawing housing provident fund to pay the down payment for house purchase for one month, the Municipal Housing Provident Fund Management Center has handled the information filing of 352 real estate fund supervision accounts, and has withdrawn 4.73 million yuan of housing provident fund for employees to pay the down payment for house purchase, supporting rigid and improved housing demand, further guiding market expectations, boosting housing consumption, and promoting the virtuous cycle and healthy development of the real estate industry.
Also supporting the provident fund for the down payment is Huainan, Anhui. On May 24th this year, Huainan issued "Opinions on Promoting the Stable and Healthy Development of the Real Estate Market in the City", which also mentioned that the housing provident fund can be withdrawn to pay the down payment for the purchase of new commercial housing.
By July 25th, the data released by Huainan Housing Provident Fund Management Center showed that since the implementation of the New Deal, Fengtai Sub-center of the Municipal Provident Fund Center had handled 12 cases to support employees to withdraw provident fund for the down payment of house purchase, amounting to 1.445 million yuan. 48 new loans with an amount of 17.942 million yuan; A total of 0.54 million square meters was supported for employees to purchase houses, which directly boosted housing consumption by 33.4787 million yuan.
Zhang Bo, dean of the branch of 58 Anjuke Real Estate Research Institute, pointed out that in the past, if the provident fund in most cities needed to be withdrawn, it was usually used to repay the principal or offset the monthly payment after the loan was completed. It is clear that the provident fund can be used as the down payment for buying a house, which shows that the provident fund has more convenience in use and can play a greater role in releasing some precipitated and long-term unused provident funds. In the actual purchase process, the ability to pay will be improved, which will also accelerate the pace of entering the market, especially for the first group that just needs it, and improve the utilization rate of the provident fund as a whole.
Chen Xiao, a senior analyst at Zhuge Housing Search Data Research Center, mentioned that from the perspective of urban distribution, the cities that introduced this policy are mainly third-and fourth-tier cities, supplemented by some weak second-tier cities. The third-and fourth-tier cities have experienced several rounds of policy loosening this year. In fact, the boosting effect on the market is limited, and the market needs more substantive and powerful policy blessings. From the perspective of policy means, the provident fund policy, as an important means of policy adjustment since this year, has been an advanced process of loosening the policy, from the initial increase in the amount of provident fund loans and the reduction in the down payment ratio of provident fund to the direct permission to withdraw the provident fund as the down payment, which has given greater support to buyers and released a more flexible and relaxed policy orientation in the use of provident fund in the future. From the effect point of view, the policy is of great significance to appropriately reduce the purchase cost of buyers, further alleviate the pressure of buyers’ purchase funds, and at the same time give more in-depth play to the supporting role of housing provident fund for buyers, boost buyers’ home ownership sentiment, and promote the release of rigid and improved housing demand.