Return to the 10,000 yuan era? Many properties in Dongguan are selling below land prices
2024-08-07
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The building where the “worker-refunded housing” is located in Yunrui Mansion, Dongguan.
New home pricing continues to cater to the market.
Jiang Xiaoting/Sent from Dongguan"Deals were completed soon after the news was released, with more than a dozen units sold in an hour," "More than 30 units were snapped up on the day of the event" - following the popularity of marketing activities such as "50% off on houses" and "Buy one get one free," the trend of profit concessions and sales promotions in Dongguan's real estate market continues.Recently, some projects in the Dongguan Water Village area, which has a weaker market presence, have once again become popular with a unit price of only 10,000 yuan/square meter. The first to start this round of price cuts was the OCT Yunrui Mansion project located in Mayong, Dongguan. Compared with the floor land price of 14,000 yuan/square meter, the unit price of 10,000 yuan/square meter is very attractive. Not only that, after further understanding, the housing sources it promotes are pure slab-type small high-rise buildings with one elevator and two households with high livability, and they are ready for sale. In addition to the Yunrui Mansion project, another state-owned enterprise development in Hongmei, Dongguan Water Village, Shoukai Xijiangyue also put out a batch of houses with a unit price of only 10,600 yuan/square meter for sale, with optional floors and fine decoration.It is learned that the above-mentioned low-priced houses are all construction-mortgage houses. "Construction-mortgage houses" refer to the real estate under the real estate developer's name being used as collateral to mortgage to the contractor to repay the construction project payment owed by the contractor. In order to repatriate funds as soon as possible, the construction contractor usually sells the house at a low price.The latest batch of worker-backed housing sold by OCT Yunrui Mansion, with a unit price of only 10,000 yuan/square meter, is located in Buildings 10 and 11 of the project, and both are three-bedroom products with a construction area of about 100 square meters. The floor land price of the project is 14,000 yuan/square meter. The first batch of pre-sales was in May 2022, and the average price of the registered price was 24,000 yuan/square meter. At present, the normal selling price of small high-rise houses is about 17,000 yuan/square meter, and the unit price of high-rise houses with two elevators and four households starts at 14,000 yuan/square meter.According to the sales staff of the above project, the deal was completed soon after the news was released. "At present, there are still one or two first- and second-floor houses left in this batch of projects. The other 8 and 9 buildings are also mortgaged to the project party, but it is not clear when they will be put up for sale."Following Yunrui Mansion, Shoukai Xijiangyue also put out a batch of housing for sale at a unit price of only 10,600 yuan/square meter, with any floor available and fully decorated. The floor land price of this project also reached 14,000 yuan/square meter.According to the on-site property consultant, more than 50 units were actually sold in just a few days from the announcement of the news on the evening of August 1 to the end of the event on the 4th. Compared with the single-digit sales of the project every month, this transaction data is outstanding. At present, the average selling price of the project is about 16,000 yuan per square meter.It is worth noting that as houses to be used to pay for construction projects, developers generally choose houses with locations or apartment types that are not particularly good in order to ensure the sales of other normal houses. For example, the construction housing units launched by Xijiangyue, the first project in Beijing, are located in Building 1 of the project, which is also the location of the competitive construction part during the land auction; the construction housing units launched by Yunrui Mansion are located in a small high-rise building near the roadside, and the apartment types are all three-bedroom units with a construction area of about 100 square meters. "Other small high-rise buildings are all '4+1 rooms', which will not have much impact." said the sales staff of the Yunrui Mansion project."Under the current market conditions, as long as we can sell the houses, it's a good thing." A person from a local real estate agency said that the key point is whether the quality of delivery can be guaranteed after the profits of real estate companies are affected by the decline in housing prices. This is also the key to testing a good company.In addition to the low-price sales of the above-mentioned worker-discounted housing, some high-priced land projects are also reducing prices for promotions. For example, Hongrongyuan Xiyuanshanyuan, which acquired the land at 25,900 yuan/square meter, had an average price of 37,000 to 40,000 yuan/square meter for the first batch of high-rise buildings registered in July 2022. Now the selling price of high-rise residential buildings has dropped to 20,000 yuan/square meter and the overall average price is about 25,000 yuan/square meter, which cannot cover the land price.In addition to business reasons, the continuous breakthrough of new home prices is also inseparable from the influence of second-hand home prices. According to the city-wide online signing data released monthly by the Dongguan Housing and Urban-Rural Development Bureau, from the first half of 2024 alone, the average transaction price of second-hand homes in the city has fallen month by month from 19,800 yuan/square meter in January to 17,800 yuan/square meter in June, a drop of about 2,000 yuan/square meter in half a year.Looking further at the data for June, 25 towns and streets in Dongguan, or nearly 80% of the areas, have seen the average online signing price of second-hand homes return to or below the 1-digit level. Among them are towns and streets such as Guancheng, Wanjiang, Humen, Liaobu, and Fenggang and Tangxia, which were in the first tier of housing prices in the past and are close to Shenzhen."The prices of second-hand and nearly new houses in the surrounding area are between 9,000 and 10,000 yuan per square meter, and new houses can only be priced like this." said Che Derui, COO of Yuanzhuyun and executive director of China Real Estate Research Institute.In addition, judging from the current policies implemented in the Dongguan property market, the price reduction of new houses has long returned to the market. As early as November 2023, the Dongguan Municipal Housing and Urban-Rural Development Bureau optimized the declaration of sales prices for newly built commercial housing. According to the implementation standard, if the sales price of newly built commercial housing that has been pre-sold (currently) sold but not sold needs to be changed, it can be changed within 30 days from the date of obtaining the pre-sale license (or the sales restriction filing certificate) or the date of the last adjustment of the declared price. The upward floating range shall not exceed 5%, and the downward floating range is unlimited. Under the current market conditions, the pricing of real estate projects is also catering to the adjustments and fluctuations of the market.Li Yujia, chief researcher at the Housing Policy Research Center of the Guangdong Provincial Institute of Urban and Rural Planning, said that the popularity of low-priced houses means that home buyers have certain expectations for a drop in housing prices, which will further lead to lower price expectations, thus affecting market sentiment and transactions.
Editorial Board Member on Duty: Li HongmeiEditors: Ma Lin, Wen Hongmei, Liu Ya
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