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Beijing property market. Photo by Li Kaixuan

The new policy has begun to release effects, and Beijing's housing market has a good full-month report card. According to data released by institutions, after the "June 26 New Policy", Beijing's new home sales from June 27 to July 23 were 4,063, a daily increase of 47.9% over the daily average from June 1 to June 26; second-hand home sales were 14,323, a daily increase of 17.3% over the daily average from June 1 to June 26.

However, the industry believes that the current transaction volume of new homes in Beijing is still lower than the same period last year, and although the transaction volume of second-hand homes has increased year-on-year, it is the result of trading price for volume. Many agents said that the price of second-hand homes in Beijing has dropped significantly, and the price of school district homes has dropped significantly this round because their previous prices were relatively high.

New policies boost real estate market transactions

On June 26, the Beijing Municipal Housing and Urban-Rural Development Commission, together with several other departments, once again issued new policies for the property market, reducing the minimum down payment ratio for the first home to 20%, allowing Beijing-based families with many children to recognize the second home they purchase as their first home, lowering loan interest rates, allowing those using provident fund loans to purchase green buildings to obtain higher amounts, and launching the old-for-new commercial housing exchange program.

The industry believes that the new policy launched by Beijing this time is sincere and the market will also recover due to the new policy. "Customers with urgent needs still account for a larger proportion. The down payment ratio has dropped a lot. Many customers who may not have sufficient budgets before now have enough funds. The new policy has converted a wave of customer resources that were waiting and watching." A real estate agent in Chaoyang, Beijing told the reporter of China Times.

In addition, real estate consultants of several popular new housing projects in Beijing recently, including Longyue Hexi and Huaxiang No. 1, also told the China Times reporter: "After the new policy, the number of visiting customers on weekends has increased significantly, and the recent housing sales have been good." Data released by the Beijing Municipal Housing and Urban-Rural Development Commission showed that from June 27 to July 24, the number of new homes signed online in Beijing was 4,233, and the number of second-hand homes signed online was 14,966, up 41% and 12% respectively from May 29 to June 25.

Data monitored by China Index Academy show that from June 27 to July 23, 4,063 new homes were sold in Beijing, a daily increase of 47.9% from June 1 to June 26, but a decrease of 11.4% from the same period in 2023; 14,323 second-hand homes were sold, a daily increase of 17.3% from June 1 to June 26, and an increase of 52.0% from the same period in 2023.

Chen Wenjing, director of market research at China Index Academy, told the China Times reporter: "Overall, after the new policy, the activity of Beijing's real estate market has increased. Combined with the impact of concentrated online signing at the end of June, the transaction volume of new and second-hand houses in Beijing has increased compared with before the new policy."

Second-hand housing prices rose in June

As mentioned above, compared with new houses, the transaction volume of second-hand houses has increased more significantly, which is the market performance after "trading price for volume". Beijing's second-hand housing prices are indeed in a state of obvious decline. Data released by the National Bureau of Statistics showed that in June this year, the sales price of second-hand houses in Beijing fell by 7.8% year-on-year. In addition, since the beginning of this year, Beijing's second-hand housing prices have continued to fall month-on-month every month, and only turned to rise for the first time in June, but the increase was relatively low, at 0.2%.

"The prices of school district housing were already high before, and now the prices have dropped dramatically. The prices of school district housing in Haidian Wanliu have been dropping, but the prices in Xicheng have dropped even more." A real estate agent who recently turned to driving an online car-hailing service part-time because of the obvious weakening of real estate transactions in Haidian Wanliu told the China Times reporter, "Alas, the prices of school district housing have really dropped dramatically."

"Because I 'stood guard' the school district housing in Guangwai, Xicheng, at a high price in 2021, I often went to the real estate trading platform in the past two years to see how much houses with the same apartment type in the same community were selling for. At the beginning of 2023, there was a house listed in the community with a listing price of 7.35 million yuan. Around October 2023, another house with the same apartment type was listed, and the listing price was reduced to 6.5 million yuan, and the final transaction price was only 6.1 million yuan. Now, houses of our type can't be sold for more than 6 million yuan." An owner who purchased a school district house in the Guangwai area of ​​Xicheng told the China Times reporter.

Another owner who bought a school district house in Haidian had a better attitude. He told the reporter of China Times: "We bought the house in 2022. I didn't pay much attention to the market after I bought it. My wife received a related push on the social platform. I clicked on the trading platform to check and found that it had dropped by 600,000 yuan compared with before. Now neither of us pays attention to the property market, so we just pretend that there is no drop."

However, an agent in Xicheng told the China Times reporter that after Beijing implemented the policy of "recognizing housing but not loans" and reduced down payments for the first time in December 2023, school district housing in Xicheng has undergone a round of price cuts, and the transaction cycle of owners who are more willing to reduce prices is also faster.

Overall, price cuts still seem to be the main theme of Beijing's second-hand housing market. "About five or six houses were sold this month, which is not bad. Now there is a three-bedroom apartment for 9.6 million yuan on the market. At the end of last month, the transaction price of a house with the same floor plan was 9.8 million yuan," a real estate agent from Laizhen Home told the China Times reporter.

The entry of the land king into the market has led to speculation of a market recovery

"Recently, it has become difficult to negotiate for school district housing in Xicheng. Buyers have found that sellers are unwilling to lower their prices and are not in a hurry to sell their properties. The negotiation cycle between the two parties has lengthened, and there is a feeling that the market needs to 'stabilize.'" The above-mentioned intermediary told the China Times reporter.

Meanwhile, on July 25, a "king of land" was sold in Beijing's Haidian District, and its high sales guidance price inevitably triggered speculation that the market will soon pick up. It is reported that the total transaction price of the Yongfeng plot in Haidian District was 8.901 billion yuan, making it the real "king of land" in Haidian District, with a floor price of 54,643 yuan per square meter and a premium rate of 3.5%.

The reporter of China Times learned that this plot of land was sold for the second time. In December 2016, the Vanke consortium acquired the plot of land for 5.9 billion yuan, but later withdrew the land for various reasons. After it was put on the shelf again, the conditions for selling the plot of land were relaxed, and the company no longer needed to hold the land, which greatly reduced the company's development pressure.

Finally, after three rounds of online bidding and five rounds of on-site bidding, the Haidian Yongfeng plot was won by the Poly and Construction Engineering consortium, with a sales guide price of 90,000 yuan per square meter, which can fluctuate up and down by 8%. Yongfeng area has been a major supplier of new houses in the past two years. Zhang Kai, director of land market research at China Index Academy, said that in the first half of this year, three plots of land in Beijing Haidian Yongfeng area have been put on the market, and there are still stocks of projects on sale in the surrounding areas. At the same time, the total price of new plots is relatively high, so there is no fierce competition.

Due to the 3 billion yuan increase in prices after the second entry into the market and the high sales guidance price, some netizens have been discussing on social platforms that this is a signal of rising housing prices. Regarding the future of the Beijing property market, Chen Wenjing believes that from the data, the year-on-year increase in second-hand housing transactions is relatively large in the context of price-for-volume, but the year-on-year decrease in new housing transactions is still there, and the short-term market adjustment pressure is still there.

Editor-in-charge: Zhang Bei Editor-in-chief: Zhang Yuning