Cross-posted from Investing in Chinese Stocks.
No more debt for the real estate industry, at least for now. According to industry source, even qualified offerings are halted at the moment. Firms aren’t so much concerned about the temporary halt as what are anticipated to be new, more stringent rules once the halt ends.
SCMP: China’s bourses suspend bond sales by some property companies ahead of tighter rules from regulator
In a move that signals a wider crackdown on bond sales by Chinese property companies, Shanghai Stock Exchange has suspended bond raising applications from developers that would be disqualified from issuing corporate debt under new guidelines expected to be issued by the securities regulator, industry sources said.
Some smaller real estate companies have failed to receive final approval for bond sales on the Shanghai exchange even after going through the required paperwork, an investment banker with a Shanghai based mid-sized brokerage told the South China Morning Post.The 21 Century Business Herald reported on Wednesday morning that China’s stock exchanges have suspended final approval for property companies applying for bond sales.
“It seems the regulator will soon introduce new rules regulating property bond sales, and the bourses are proactively adopting tighter measure ahead of that,” said the brokerage source.
Caijing: 券商主承：交易所暂停地产公司债 重启后将进一步收紧
After more than a year after the fast heavy volume, the exchange issue size accounted for the largest real estate company debt, seems to usher in a hundred and eighty degree turn.
October 19 morning, a number of brokerage master Cheng Renshi 21st Century Business Herald reporter said that the real estate business exchanges suspended the issuance of corporate bonds, including’ve got no objection letter items.
Under the new corporate bond issuance management practices, corporate bonds project was a no-objection letter, in theory, after the release of the documents for the record, can be issued. Digital Master Cheng Renshi have said that had never hindered in part of the record, but in the near future Exchange “does not accept either the record or material received no response.”
On that day, although informed sources close to the exchange securities for the matter said that the current real estate business departments according to specific financial status indicators, which developed real estate companies may issue corporate bonds, which companies need to issue prudential standards. Standards related differences in standards and relevant departments had little time to perform the audit; Since the standard will be formally issued, some financial indicators of whether the target enterprises currently exists ambiguity may be suspended reviewed, but clearly met the standard of real estate companies to issue bonds issuance unaffected.
However, at least two to accept the 21st Century Business Herald reporter interviewed Cheng Renshi main brokerage said its underwritten project is “normal class” in better qualified, “but the same has been suspended.”
…Regardless of whether the Exchange suspended the issuance of all debt real estate companies, the market is more concerned that the supervision of real estate corporate bonds issued after the restart.
And in Beijing, the whip is out. Sales are down sharply in October and the city government is adding charges against 4 developers and one real estate broker. The four developers are accused of hoarding property. 我爱我家 (Homelink) has 12 separate violations filed against it, such as for unauthorized listings.
iFeng: 京上半月楼市成交涨幅降29% 4项目被停网签
Plus the official media is loose even though blame for the housing bubble falls squarely on government and monetary policy, Xinhua wants everyone to focus on the symptoms of shady real estate practices. One again unto the breach goes the central planner:
Recently, the Ministry of Housing and Urban Construction another telling standardize the real estate development enterprises, clearly listing will publish false, malicious speculation, hoarding and other nine kinds of unfair business practices severely punished according to law. In many market regulation upgrade in the background, a move no doubt is a mind thunder, that the government realized that the current real estate market regulation is urgent, determined to cut off cancer disrupt the market in order to achieve long-term healthy development of the real estate market.
Including the previous round of soaring house prices, including fluctuations in the property market, real estate market disorder are exposed is an important factor in pushing up prices, some developers to reap huge profits, accustomed to spreading false news, artificially creating panic, seriously damaging the interests of consumers, affect the healthy development of the property market.
…A healthy real estate market, there must be iron-fisted rule to maintain order. The Department of Housing and 9 kinds of unfair business practices to be clearly defined. The courage to play the competent departments should strictly enforce the law, to prevent a criminal record or fail to investigate the behavior of poor accountability shield enterprises to accelerate the real estate industry credit system construction, in the whole society Jiangyoufalie guide is formed, so that housing prices become illegal behavior “across the street mouse”.
iFeng: 新华时评：剪除中国楼市的毒瘤刻不容缓
