The new housing provident fund policy directly under Hunan provincial authorities has been officially rolled out, and the provision that "young talents' loan quota is decoupled from their account balance and set at 1.5 times the normal level" has become the biggest highlight.

On August 25, the Hunan Provincial Direct Housing Fund Management Center issued the *Implementation Rules for the Implementation of the Several Measures of Hunan Province to Further Promote the Stable and Healthy Development of the Real Estate Market*, which officially took effect on the same day. Different from Chengdu's new policy of "15% down payment + interest subsidy" that focuses on reducing costs, Hunan's current round of policies mainly focuses on increasing loan limits, expanding withdrawal scenarios and liberalizing family mutual assistance, among which the youth talent loan policy has the largest adjustment intensity.

The loan limit for young talents has been significantly increased. For young talents aged 35 (inclusive) or below with a full-time college degree or above, who apply for provident fund loans for first home purchase in Changsha, the loanable amount will no longer be linked to the account balance; with one full month of contribution, the maximum loan limit will be 1.5 times higher than the current basis, with a maximum of 1.8 million yuan for purchasing new commercial housing and 1.5 million yuan for purchasing second-hand housing. According to the calculation by the China Index Academy, this limit is 2.25 times that of ordinary employees (800,000 yuan) and 2 times that of three-child families (900,000 yuan), leading among all types of contributing groups, and directly improves the payment ability of young groups for their first home purchase.

Deed tax and property maintenance fund can be withdrawn, reducing the cash expenditure for home purchase. Contributing families purchasing their first or second self-occupied housing can apply for withdrawing provident fund once within 36 months from the date of issuance of the invoices after paying the deed tax and the special property maintenance fund, and the withdrawal amount shall not exceed the actual expenditure. This part of the expenses that previously needed to be paid out of pocket can now be covered by provident fund, reducing the cash pressure in the transaction link.

Intergenerational mutual assistance is liberalized, allowing parents and children to withdraw and use provident fund jointly. For contributing families purchasing new commercial housing (first or second home), if there is still insufficient balance after withdrawal for home purchase, parents and children can withdraw their respective provident funds to make up the difference, and can also apply to be added as co-borrowers to handle monthly offset repayment and early repayment; and the housing location scope has been extended to the whole country since July 1. For many families, this means mobilizing the funds in both sides' provident fund accounts to ease the home purchase and repayment pressure of their children.

Direct payment withdrawal and the first-home interest rate for talents are implemented simultaneously. The rules also support direct payment withdrawal for home purchase funds when purchasing new commercial housing (including off-plan housing and existing housing) in the five districts of Changsha. Home buyers can submit a pre-application before signing the contract to generate a withdrawal business code, and the funds will be directly transferred to the developer after signing the contract without paying the money in advance; at the same time, for talents aged 45 (inclusive) or below who purchase new commercial housing as improved housing, the number of existing housing units will not be counted, and the first-home loan interest rate will be implemented.

Overall, the policy intensity is considerable, but the beneficiary groups are relatively concentrated. The provident fund adjustments in Hunan this time are not inclusive relaxations, and mainly benefit young talents and families with improved housing needs.

Appendix 1: List of core policy clauses

Data compiled by China Index Academy, based on the documents issued by Hunan Provincial Direct Housing Fund Management Center

This article is from the WeChat Official Account "China Index Academy", author: China Index Academy, authorized for release by 36Kr.