The decline in house prices depends on one indicator: the degree of debt of residents.

Because its limit is the limit of rising house prices.

The source of the sharp drop in house prices is that the leverage balance of residents has been broken.

How to break it? This needs to be done at both ends. On the one hand, housing prices continue to rise and residents' debts continue to increase; At the other end, the employment situation has deteriorated and residents' income has declined. ...

If an economist says that house prices have peaked, he will probably analyze them from the following aspects:

1, urbanization is over;

2. The real estate tax is coming;

3. The situation at home and abroad is critical;

4. A population crisis has emerged;

It's time for monetary policy to turn.

When urbanization comes to an end, it means that the power of urban expansion disappears, that is, land finance comes to an end, and it is bound to supplement fiscal revenue through real estate tax.

When the internal situation of the country is the polarization between the rich and the poor and the population crisis, and the external situation is the trade friction and the new cold war, which means that the economic structure transformation is imminent, then monetary policy can no longer continue to flood as before.

However, after studying the economic history of Japan and South Korea and analyzing the corresponding housing price trends in different stages, I found that urbanization rate, real estate tax, population crisis and even external situation are not decisive factors that can affect the housing price trends.

Take South Korea as an example:

Moon Jae in promised to lower house prices during the campaign. After he took office, he raised the real estate tax to 1.2%-6%, and the multi-suite transfer tax was as high as 65%-75%.

South Korea's newborn birth rate is the lowest in the world, and South Korea may even be the first country in the world to die of natural causes.

South Korea's urbanization level has reached the point where it can't grow, and it is stable at around 82%:

South Korea's external environment is also quite bad. In addition to the poor brothers in the north, they are also competing directly with Japan in many fields. In 2020, the Korea-Japan trade war once made headlines. But the above situation has not affected the rise of housing prices in Korea at all: but, ah, monetary policy is definitely the most critical variable affecting housing prices, which is a universal truth.

After the epidemic, we have seen clearly that the asset prices of various countries feed back the monetary phenomenon of their own countries, which has nothing to do with the fundamentals-monetary easing and rising house prices, and once the currency contracts, house prices will definitely fall, which is beyond doubt.

The problem is that in the bubble state, currency contraction will directly puncture the bubble, leading to a series of economic problems, which will make policy makers in a state of tightness before loosening.

Take South Korea for example. After the monetary tightening policy was implemented for a period of time, the debt risk of developers was exposed, and the richest people were sad for a while, so they began to loosen up again ... Therefore, it is unrealistic to expect policy makers to sympathize with the high cost of living of young people and reduce their housing prices. House prices will not continue to rise, just because there is a logical limit, and house prices are approaching this limit, and there is no room for further increase. House prices will fall only because if measures are not taken, worse things will happen, which is a helpless choice to choose the lesser of the two evils. Let's talk about the price limit. Under what circumstances, house prices will not go up, but will turn around and go down.

In the development model of East Asia, real estate has assumed a very important function-gathering surplus labor. For example, in the early days of the People's Republic of China, although our country was vast and rich in products, we could only sit in the mine and worry, because we could not mine without machines. Agricultural products can be exchanged with other countries for foreign exchange, and then machinery and production lines can be imported with foreign exchange. This is the so-called "agricultural subsidy industry". Farmers 10 bear the grain, leaving 5 for themselves and 5 for the government, which is called labor surplus. Therefore, the primitive accumulation of industrialization in China was saved by the peasant brothers who worked hard to save money. The essence of real estate is to transfer residents' savings and future income to the government through banks. On the one hand, there is a large collection cost, on the other hand, it will dampen the enthusiasm of labor.