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author: liang zhengyu

from west to east, a wave of discounts on commercial apartments is sweeping across shenzhen.

according to a reporter from the times weekly, many commercial apartment projects in shenzhen have been sold at a discount recently, with unit prices as low as just over 20,000 yuan per square meter, and a small-sized unit can be purchased for a total price of less than 1 million yuan.

due to the large-scale "loss-cutting" of developers and the popularity of small-sized units in the rental market, the return on investment has been raised in one fell swoop. the return on some commercial apartments has reached 3%-4%, while the rental return on residential products is only about 1%.

however, due to the long-term market adjustment, investment demand has ebbed, and even though developers have been promoting it hard, overall transactions have not seen any significant improvement.

the rate of return given up by the developer

"it's more reliable than stocks and financial management," zhao min, sales manager of centaline property, told the times weekly reporter. thanks to the developers' initiative to make concessions, the return on investment of some commercial apartments in shenzhen is 3% or more, "and this is the return rate in the context of a downward rental market."

centaline property is the sales agent of kingkey residences, and zhao min is responsible for the sales of its apartment products. kingkey residences was launched in mid-august this year, and zhao min revealed that more than 300 commercial apartments have been sold so far.

the reason for the hot sales is that the developer offers large discounts, which increases the return on investment.

according to a reporter from the times weekly, the average discounted price of kingkey chenyuefu business apartments is about 45,000 yuan per square meter, and a single room with a construction area of ​​about 38 square meters can be purchased for a minimum of 1.5 million yuan.

for comparison, the average registered price of residential products of kingkey chenyuefu is about 88,900 yuan/square meter. three years ago, an apartment complex in the same area was priced at nearly 90,000 yuan/square meter. the selling price of kingkey chenyuefu's commercial apartments is nearly 50% lower than the previous price, so it is also called a "price bomb" in the industry.

a 38-square-meter unit with a total price of 1.5 million yuan can be rented for 4,000 yuan per month, conservatively estimated based on the current overall rental level in the meilin area. the return on investment is 3.2%, which is higher than the three-year deposit rate of most banks.

_{jingji chenyue mansion under construction, photo taken by time weekly}

"there is currently no product in futian with such a small area, low unit price and low total price. the boss directly made concessions on the price. small apartments are very suitable for investment customers with relatively low investment, so transactions are very active." zhao min said.

in order to ship quickly, kingkey not only made concessions on price, but also made detailed plans for customers' visiting routes, suggesting that the channel parties take customers to view houses through subway stations and parks. customers can also draw activation codes for the recent popular 3a game "black myth: wukong". because the location is close to the honor office, kingkey also promoted "being the landlord of honor people" as a selling point for chenyue mansion.

"the project's marketing was good, and the price was very advantageous, so it was recognized by many local customers in futian, nanshan, and luohu. there were also customers from other places who came to buy, and more than ten units were sold." zhao min told the times weekly reporter.

“if you want to get your money back, you have to make concessions”

shenzhen's commercial apartments are not an isolated case of price cuts, and the discount trend has spread throughout the city. from bao'an, futian, longhua, luohu to longgang, there are apartment projects selling houses at a discount.

at a commercial and office project in bao'an that is currently on sale, the lowest unit price for large flats after discount is 42,000 yuan per square meter, while the registered average price is over 80,000 yuan per square meter; at a ready-to-move-in apartment in longhua, the lowest unit price is about 30,000 yuan per square meter, while the original registered average price is over 60,000 yuan per square meter. the total price of a unit with a construction area of ​​about 92 square meters is just over 3 million yuan; at a property in luohu that is selling small-sized apartments, the "fire sale price" is 20,000 yuan per square meter. the agent of the agency revealed that the lowest total price of a single room with a construction area of ​​38 square meters is about 750,000 yuan.

"it's not that we want to price it so low. the current market requires extremely low prices to sell goods. do developers want to get their money back? if they want to get their money back, they have to make concessions. this is the real market situation now." zhao min said.

the low-price strategy is not a panacea. due to the "disappearance" of investors, the market has not yet emerged from the downward channel. although the sales of commercial apartments, which are equivalent to 50% or even 40% off the residential price, are active in some areas, the overall market is still sluggish.

according to the statistics from shenzhen cric, in august this year, the transaction volume of commercial apartments in shenzhen increased while the price decreased. the transaction area was about 28,200 square meters, a month-on-month increase of 4.61% and a year-on-year decrease of 2.2%; the average transaction price was about 46,000 yuan/square meter, a month-on-month decrease of 24.47% and a year-on-year decrease of 33.69%.

shenzhen zhongyuan research center believes that from the supply perspective, commercial supply fell sharply in august, and there was zero office supply for two consecutive months. commercial and office supply continued to be at a low level. coupled with the influence of the overall environment, commercial and office market transactions will remain sluggish.

in recent years, due to the market downturn and a sharp drop in investment demand, the supply scale of commercial apartments has shrunk significantly. cities such as shanghai stopped approving apartment-style office projects in 2017. shenzhen stopped planning approval and land transfer plan approval for new commercial apartment projects across the city from july 2020. guangzhou announced in april this year that it would stop planning approval for new apartment and other residential projects across the city.

monitoring data from the shenzhen zhongyuan research center shows that since shenzhen stopped approvals in 2020, the scale of commercial apartment supply has peaked and then fallen. in the first half of this year, only two apartment projects were approved, with a supply area of ​​60,000 square meters, which is only 20.7% of the whole of last year; in terms of transactions, 1,337 apartments were sold in the city, a year-on-year decrease of 62.4%, and the transaction area was 74,000 square meters, a year-on-year decrease of 68.2%. the transaction area is only 1/10 of the peak period in 2020.

_{image source: shenzhen centaline research center}

li yujia, chief researcher of the guangdong housing policy research center, believes that the price drop of commercial apartments and other residential projects that have already been launched is much greater than that of residential properties, which has had a huge impact on the real estate price system and is difficult to sell.