The three red line standards of real estate are: the asset-liability ratio after excluding advance payment is not more than 70%, the net debt ratio is not more than 100%, and the short-term cash debt ratio is not less than 1. The national standard of setting three red lines is mainly to better implement the long-term mechanism of China's real estate market, and it is also an important part of China's real estate financial management system. Strictly following the standards of three red lines can make the current real estate enterprises arrange financing behavior more reasonably, avoid blind expansion and improve their ability to resist risks.

With the increasingly strict control of the real estate market in China, enterprises that exceed the three red lines will be divided into four grades: red, orange, yellow and green. Enterprises that all three red lines touch are red files and cannot have new interest-bearing liabilities. The annual growth rate of liabilities of enterprises meeting the two lines shall not exceed 5%, and that of enterprises meeting the one line shall not exceed 10%.

Click to view: three red line standards of real estate.