2024-08-09
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Author: Yu Fei
01
Shanghai's property market has hit the ceiling
It has to be Shanghai.
Shanghai has always been the holder and breakthrough of top real estate prices in mainland China.
In the first half of the year, China Overseas Shunchang Jiuli, located in the core area of Huangpu District, Shanghai, sold 505 out of 512 units in one day, with total sales of 19.653 billion yuan. This sales figure set a record for the highest sales volume in a single launch in the history of commercial housing in the country.
This is equivalent to a house worth 38.92 million yuan.
Four months later, in August, Shanghai again produced the country's most expensive land per unit price.
On the afternoon of August 7, the xh128D-07 plot of land located in Xietu Street, Xuhui District, Shanghai was finally put on the auction table. After 72 rounds of bidding, the price reached the ceiling and was finally pulled into the lottery stage. Four bidders, namely, Chenjia Development, Greenland, China Overseas & Shanghai West Bund Development, and China Merchants Shekou & Xuhui Urban Investment, started the lottery.
In the end, Greentown became the lucky winner. The transaction was completed at 4.8048 billion yuan, with a floor price of 1.31045 million yuan per square meter and a premium rate of 30%. This transaction price not only broke the record of 100,200 yuan per square meter when No. 1 Zhongxing Road was acquired in 2016, becoming the new highest price per square meter for residential land in Shanghai, but also set a new record for the highest price per square meter for residential land in the country.
It should be pointed out that the two exciting projects mentioned above are both luxury homes and have nothing to do with ordinary people.
The average registered price of Zhonghai Shunchang Jiuli in Huangpu District is 172,000 yuan per square meter, and the average total price of each unit is about 40 million yuan.
The latest plot of land in Xuhui District with the highest unit price in the country was born with a golden spoon of luxury homes in its mouth. It is surrounded by many luxury homes, including Huiyuanxi on the north, Qiyuan on the south, and Yujiangting on the east. It is about 400 meters away from the Huangpu River in a straight line, making it the hottest plot in this land auction.
Based on the estimated floor price of 130,000+, the future selling price of this project will definitely start at 200,000.
02
folded world
In the current environment of overall decline in the real estate market, why are there still developers willing to acquire land at the highest price?
The logic is simple. This is a luxury house. And luxury houses have no shortage of buyers. This year, Shanghai's luxury houses are in full swing.
Let's look at a few sets of data. In the first half of this year, the national commercial housing sales area was 479.16 million square meters, a year-on-year decrease of 19.0%, and the sales of newly built commercial housing was 471.33 billion yuan, a decrease of 25.0%.
The luxury housing market is still in full swing.
Data disclosed by CRIC showed that 2,264 high-end residential units with a total price of more than 30 million yuan were sold in 61 key cities, an increase of 78% over the same period last year. 401 high-end residential units with a total price of more than 50 million yuan were sold, an increase of 1.2 times over the same period last year.
Specifically, in the first half of 2024, 5,187 high-end residential units with a total price of RMB 10 million to RMB 30 million were sold in Shanghai, a year-on-year decrease of 32.4%, and 1,236 units with a total price of RMB 30 million to RMB 50 million were sold, a year-on-year increase of 192.6%, accounting for nearly 70% of the total number of units sold in the statistical cities. A total of 308 high-end residential units with a total price of more than RMB 50 million were sold, a year-on-year increase of 422%, accounting for nearly 80%.
Data tells us that the more expensive the house is, the easier it is to sell in Shanghai. A total of 18 luxury houses with a total price of over 100 million yuan were sold nationwide, of which nearly 80% were sold in Shanghai, with 14 units sold, a year-on-year increase of 180%.
Similarly, the Hyde Garden project in Futian District, Shenzhen, which was launched for the fourth time not long ago, sold out all 116 units within less than 3 hours after the launch, achieving a 100% sales rate. The project's sales on that day reached about 2.69 billion yuan.
The point is that the first three times Hyde Garden was launched, it was also sold out. This time, the price is even higher than before. The construction area of a single residential unit is about 87 square meters to 450 square meters, and the average price of rough housing is about 128,500 yuan per square meter, which is 2,500 yuan higher than before. The entry threshold exceeds 10 million yuan, and the price of the most expensive unit is 59.99 million yuan.
All these things really prove the saying that “poverty limits our imagination”.
Regarding this phenomenon, we can only sigh that the world is folding. Although the rich and the poor live under the same sky, they are two different parallel worlds that will never intersect.
People's joys and sorrows are not the same. In the current environment, some people are worried about losing their jobs, just like Wu Zixu who was worried about crossing the Zhaoguan Pass. Some people are still thinking about making millions of dollars without any effort by investing in new stocks.
In this world, fairness is always relative, while unfairness is absolute. Every economic adjustment will further widen the gap between the rich and the poor.
Because when dealing with uncertainty, the rich have resources, channels, and methods, while the poor can only carry it with their seven-foot bodies and two shoulders.
Neither the birth of a new land king nor the explosive sales of luxury homes can indicate a market shift, because the luxury home market is a very small market and a very small circle.
Ordinary people just need to treat it as a topic of conversation after dinner. What ordinary people need to pay attention to is the general market.
In the general market, both Shenzhen and Shanghai are falling.
03
Shanghai and Shenzhen are both falling
For Shanghai, please look at the data disclosed by the Shanghai Statistics Bureau.
The sales area of commercial housing in Shanghai peaked in 2021, with the sales area of 18.8045 million square meters that year. It dropped to 18.5288 million square meters in 2022 and 18.0803 million square meters in 2023, a decrease of 2.4%.
Source: Shanghai Statistical Yearbook 2023
Among them, residential sales peaked in 2022. In 2022, Shanghai's residential sales area was 15.6151 million square meters, with sales of 693.777 billion yuan.
In 2023, Shanghai's commercial housing sales will reach 725.999 billion yuan, down 2.8%, of which residential sales will reach 668.519 billion yuan, down 3.6%.
In the first half of 2024, the Shanghai Statistics Bureau disclosed thatThe sales area of commercial housing was 7.8323 million square meters, an increase of 0.8%, of which the sales area of residential housing was 6.4849 million square meters, an increase of 0.7%.
From the perspective of new housing performance, Shanghai is relatively stable. However, from the perspective of the second-hand housing market, which better reflects market changes, the downward trend is quite obvious.
The Shanghai Statistics Bureau disclosed that the transaction volume of second-hand houses fell from a high of 347,700 units in 2016 to 177,100 units in 2022, a decrease of 49%. The transaction area of second-hand houses fell from a high of 32.198 million square meters in 2016 to 14.2693 million square meters in 2022, a decrease of 55.7%.
In 2023, the registered area of existing housing sales in Shanghai was 17.0803 million square meters, an increase of 5.8% over the previous year. But it is still only half of the peak period.
Source: Shanghai Statistical Yearbook 2023
Among them, the transaction area of second-hand residential properties dropped from the peak of 23.513 million square meters in 2015 to 12.7182 million square meters in 2022, a decrease of 45.9%.
In terms of housing prices, the National Bureau of Statistics disclosed that the second-hand housing prices in Shanghai fell by 6.3% year-on-year in June this year, which is 6.3% lower than last year.
According to data disclosed by institutions, CRIC disclosed that the average transaction price of second-hand houses in Shanghai in the first half of 2024 was 40,758 yuan/square meter, a slight decrease from 40,854 yuan/square meter in 2023, but still remained at a high level.
allOverall, the sales volume of second-hand houses in Shanghai, which can reflect the real changes in the market, was halved, but the prices only fell slightly.
As expected of China's No. 1 economic city, it is still very resilient to price drops. However, the whole country has already fallen into a general decline, and the downward trend of Shanghai's housing prices has already formed, and the decline will become larger and larger in the future.
Compared with Shanghai, Shenzhen seems to be quite vulnerable to declines.
In 2009, the number of second-hand housing transfers in Shenzhen reached an all-time high of 155,000 units, an average of 12,900 units per month.
The number of transfers in 2015 was the second highest in history, at 127,000 units, an average of 10,600 units per month.
2017 was the year with the lowest second-hand housing transfer volume before the adjustment of Shenzhen's real estate market, with 64,000 units, an average of 5,333 units per month.
After entering the adjustment period, the transfer volume in 2021 plummeted compared to 2020. The transfer volume in 2022 hit a 20-year low of only 22,000 units, an average of only 1,833 units per month.
There was some recovery last year, but it was also the second lowest in the past twenty years, with 33,000 transfers, an average of 2,750 per month.
For new homes, last year’s transaction volume hit a record low in recent years.
In terms of housing prices, the average price of second-hand houses in Shenzhen has fallen over the past three years from a peak of over 80,000 to below 80,000 and below 70,000. In July this year, it had fallen below 60,000, returning to the era of prices starting with "5".
According to Leyoujia data, the transaction price of second-hand houses in Shenzhen was 59,000 yuan per square meter in July.
Having said so much, I just want to make one thing clear: the madness of the luxury housing market has nothing to do with us. The decline of the general market is what the public should be concerned about.
In today's general market, prices are falling across the country.
Even if they have good industries, economies and populations, they cannot resist the general trend. Although there are a number of cities with good industries, economies and populations among the cities with high housing prices, the high housing prices have seriously overdrawn the support and purchasing power of these cities.
The only difference is that cities with strong industries and strong population competitiveness will have relatively smaller declines, while cities with weak industries and strong population competitiveness will have relatively larger declines.
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