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Source: Times Finance Author: Zhong Dai

"During the peak period in 2021, every school district house was sold out. In some of the better school districts, there were many customers who made reservations on the spot after viewing the house." In Gulou District, Nanjing's strong education district, several senior real estate agents did not expect that Nanjing's school district houses, which were out of reach three years ago, have now fallen to "dirt cheap."

A typical residential community is Qinghe Xinyu Village 1, which is affiliated with Jinling Huiwen Primary School and Jinling Huiwen Middle School (referred to as "Shuanghuiwen"). "Jinling Huiwen has been very strict with its junior high school students in recent years, and the results of this year's high school entrance examination are very good. It is currently ranked among the top public junior high schools in Nanjing." Agent Li Yuan told Times Finance.

However, the good news of high scores did not support the housing prices in Shuanghui Literature District. In July this year, a two-bedroom apartment of 62.7 square meters was sold in the community for a total price of 2.33 million yuan, with a unit price of 37,000 yuan per square meter; while the same apartment sold in 2021 had a total transaction price of 5.7 million yuan, with a unit price of 92,000 yuan per square meter. From this point of view, housing prices have fallen by about 60% in three years.

Li Yuan told Times Finance that the reason why the aforementioned house was sold at a low price of 2.33 million yuan was mainly because the market conditions were poor at the time, and the house was on the top floor, the 7th floor. From May to July this year, the community had already sold a batch of low-priced houses, and it would be difficult to have such a low transaction price in the future.

Li Yuan said that in general, in 2021, the transaction price of houses on the middle floors of the community was about 100,000 yuan/square meter, and the average price of houses of more than 40 square meters could reach 120,000 yuan/square meter. Now the transaction price of houses on the middle floors is generally around 52,000 yuan/square meter and 53,000 yuan/square meter, which is a significant decrease.

On Lianjia's official website, Qinghe Xinyu Village 1 sold 10 second-hand houses from May to July, but the transaction price was not shown. The average listing price of the community in July was 65,900 yuan/square meter, which was mainly due to a small number of high-priced houses that were listed for a long time. Several two-bedroom units of more than 60 square meters were recently released in August, with an average listing price of about 53,800 yuan/square meter to 58,000 yuan/square meter.

Shuanghui school district housing is relatively valuable. Recently, a Nanjing school district housing transaction details from June to July showed that the lowest transaction price of some Nanjing second-tier middle school school district housing was around 1.4 million yuan, or even as low as a million yuan. Some Nanjing second-tier primary school school district housing can be priced as low as less than a million yuan.

Nanjing Normal University Primary School is a first-tier primary school in Nanjing Xuanwu District. Times Finance learned from agent Zhang Lin that a 31.11 square meter house at No. 38 Dashamao Lane, which is adjacent to Nanjing Normal University Primary School and Meiyuan Middle School, was recently sold for 1.2 million yuan.

Zhang Lin feels: "2019 to 2021 was the peak period for school district housing in Nanjing. So far in 2021, housing prices have dropped by about half. In terms of transaction volume, our area has decreased by about 20% to 30%. In the past, some buyers would buy school district housing two or three years in advance, but now there are basically no such buyers."

"With fewer orders and lower unit prices, our income has also decreased. For example, when the market was good, we could earn 200,000 to 300,000 yuan a year, but now we may only earn 100,000 to 80,000 yuan a year," said Zhang Lin.

Chibi Road Primary School is a second-tier primary school in Nanjing's Gulou District. Times Finance learned from the intermediary Wang Mian that recently, a 48-square-meter apartment-style residence in Longyin Plaza, which is opposite to the primary school, was sold for 760,000 yuan. The total price of a two-bedroom school district house in an ordinary old community nearby is only more than 1 million yuan. Wang Mian felt that the price of school district housing has fallen by half compared to the peak period, and the number of orders has shrunk by half compared to 2021.

The cooling of school district housing in Nanjing is due to the cooling of the overall second-hand housing market and the weakening of the concept of school district housing. Wang Mian believes: "The concept of school district housing has faded. For some top primary schools, the school district is facing expansion, and some relatively ordinary communities in the surrounding area are included in the same school district. The value of school district housing has been greatly reduced. For some second- and third-tier school district housing, the price is basically the same as non-school district housing."

The price of school district housing has fallen back, and investors have withdrawn from the market, benefiting more buyers who have just bought houses. "In the past, investors and parents bid up the price to each other, and if you don't have money, you can't go to a good school." Zhang Lin said that now there are basically no investors. In addition, Nanjing has low mortgage interest rates and low housing costs. Coupled with the decline in housing prices, the rental-to-sale ratio of school district housing has become quite cost-effective. Many owners of school district housing have received returns from renting out their houses that can cover the mortgage interest and solve the problem of their children going to school.

Li Yuan gave an example to Times Finance: "Recently, a customer just bought a 56-square-meter house in the Yincheng Primary School and Huiwen Middle School district for 2.38 million yuan. They had never considered buying a school district house in Gulou before. It cost four or five million yuan before, which was simply unaffordable. After the price reduction, they can afford it."

In May this year, Nanjing issued a number of new policies for the real estate market, including lower down payments for home purchases, lower mortgage interest rates, new household registration policies, and old-for-new housing. Some agents feel that the heat of the policy has gradually spread to the school district housing market, and the transaction volume began to pick up in August. Wang Mian, an agent who has been showing houses in the school district of Chibi Road Primary School for four years, is also considering buying an old and dilapidated house nearby as a wedding house, preferably with some school district attributes, while busy connecting with clients.

(All names in this article are pseudonyms.)