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"if you have spare money, you can buy a commercial apartment. the rental return rate can easily exceed 3%. the price is now equivalent to that of a small-property house." in the buxin area of ​​luohu, shenzhen, many real estate agency managers have become "road bullies", vigorously selling a commercial apartment project to passers-by.

many people will consider one question when buying a house: should i buy an apartment or a house? recently, a reporter found in the shenzhen market that more and more commercial apartments are grabbing the market at "low prices". some industry insiders said that this phenomenon reflects the financial pressure of real estate companies, which may have a certain impact on market sentiment.

focus on rental return rate?

generally speaking, commercial apartments are residential products that are commercial or office properties but are turned into apartments. in the past, similar commercial apartments had outstanding advantages: they were not affected by policies such as purchase restrictions and sales restrictions, they had room for autonomy in terms of apartment types, and their prices were generally lower than ordinary residential products in the same area, which meant that the cost of living in the core area of ​​the city was lower. however, the disadvantages of these apartments are also obvious - most projects have only 40-year property rights, commercial water and electricity charges are implemented, and some projects do not have gas.

when the reporter visited shenzhen futian and luohu districts, many real estate agency managers used rental return rate as the most important marketing slogan. "residential properties in the same area cost at least 50,000 yuan per square meter, while the average price of commercial apartments here is just over 20,000 yuan. due to the small size of the apartment, the unit rent per square meter is even higher than that of residential properties. the annual rental return rate is definitely more than 3%, while the annual rental return rate of residential properties is less than 1.5%." in luohu buxin, a marketing staff of commercial apartments was promoting their products.

(photo by wu jiaming of a commercial apartment project in shenzhen)

coincidentally, commercial apartments have recently been reported to be launched at “low prices” in bagualing, futian, tanglang, nanshan, and qianhai. in a commercial apartment near qianhai, the price offered by marketing staff was about 42,000 yuan per square meter, which is almost 40% to 50% of the surrounding residential properties.

a senior real estate marketing manager told the reporter that there are three main types of apartments in shenzhen: commercial apartments, commercial and office apartments, and industrial and office apartments. shenzhen has stopped approving commercial apartments that are already "residential". "commercial and office apartments can be understood as office buildings converted into apartments; industrial and office apartments are generally dormitories and require registered companies to purchase. the large number of commercial and office apartments launched at "low prices" also reflects the financial pressure of real estate developers to a certain extent, which will actually affect the confidence of home buyers."

or impact market sentiment

according to the reporter's analysis, since 2017, many major cities have successively introduced strict policies to suppress the development of commercial apartments and prohibit "commercial to residential". however, in recent times, some cities have gradually broken the ban on "commercial to residential" and instead supported "commercial to residential".

for example, the wanning municipal government office of hainan province issued the "work plan for promoting the destocking of commercial and office-type commercial housing", which allows commercial and office-type commercial housing to be managed in accordance with residential management under certain conditions, and buyers of such commercial housing can enjoy the same treatment as those who buy residential housing, such as nearby schooling for children, and the same charging standards for water, electricity, and gas as residential housing. in addition, the changsha municipal bureau of natural resources and planning and the changsha municipal bureau of housing and urban-rural development also jointly issued the "notice on supporting the adjustment of residential commercial housing such as apartments to residential housing".

in addition, many hot cities have also launched "commercial to residential" land. on the other hand, according to china index academy, the supply and demand scale of commercial and office land in the first half of 2024 is at a low level in recent years, and the investment and new construction data of commercial and office buildings have both declined year-on-year.

li yujia, chief researcher at the guangdong housing policy research center, believes that many cities have an oversupply of commercial office space, but they want to develop the building economy, and then they are "alienated" into commercial apartments. most of these commercial apartments were planned and constructed as commercial offices when they were reported for construction, but the plans were later modified according to commercial and residential use, so they are not formal commercial apartments. in the past, when the property market was hot, these products had strong investment demand because they were not subject to purchase restrictions, had small areas, and were much cheaper than residential properties in the same area. however, when the property market cooled down and the investment and financial attributes declined, similar commercial products had shortcomings such as poor living experience and large supply, so the price of similar commercial products would fall even more. although commercial apartments and residential properties have always been two parallel lines, the large discount sales of commercial products will lead to increasingly low market sentiment and a certain impact on the overall real estate market.

li yujia also emphasized that the implementation of the "commercial to residential" policy needs to consider a variety of factors, such as the need to consider the planning positioning of the area and the requirements of the national land space planning when adjusting to residential functions. at the same time, it is necessary to meet the housing land supply indicators and avoid exceeding the existing indicators. in addition, local governments must ensure that the public supporting facilities required for residential projects are in place, after all, "commercial to residential" involves fire safety rectification and public service facilities.