news

after shanghai sold the "land king" with the highest unit price in the fourth round of land auctions in 2024 on august 7, the fifth batch of land auctions in shanghai was concluded. after 163 rounds of fierce bidding, one of the plots was sold at a floor price of 114,100 yuan per square meter.

on september 14, a live trading fair was held for the n070402 unit 094a-14 plot in lingshi community, jing'an district, shanghai, and the c050301 unit 9a-20 plot in caojiadu community, jing'an district. the total land area of ​​the two plots was about 5.01 hectares, with a starting price of 10.679 billion yuan and a total transaction amount of 12.025 billion yuan.

among them, the 9a-20 plot of caojiadu community c050301 unit was finally won by china merchants and nantong ruicheng consortium at a price of 5.65987 billion yuan, with a floor price of 114,100 yuan/square meter and a premium rate of 31.2%. this unit price is lower than the floor price of 131,000 yuan/square meter of the xh128d-07 plot in xietu street, xuhui district, which was auctioned on august 7 this year, but it also exceeded the record of the most expensive land in china auctioned by rongsheng china in shanghai in 2016 (floor price of 100,000 yuan/square meter).

another plot of land, n070402 unit 094a-14 in lingshi community, was won by china construction jiuhe with a base price of 6.366 billion yuan, and the transaction floor price was 68,300 yuan per square meter.

what is more noteworthy is that this is the first time that shanghai has implemented the "double high and double competition" initiative for a hot plot of land. since the beginning of this year, shanghai's land auction rules have been adjusted several times, and the upper limit of the premium rate has been adjusted from 10% to 30%. this time, the winner will be determined in the second round of bidding by the "highest bidder wins" method.

after the “highest bidder wins” policy, the announcement for the fifth batch of commercial housing land transfer also made it clear that the market-oriented principle should be adhered to, and enterprises should independently determine the sales price of commercial housing based on market supply and demand, and implement price registration and listing sales in accordance with national and shanghai commercial housing sales management measures.

some experts said that this also means that the land and housing prices of commercial housing in shanghai have been liberalized.

while implementing the dual-high and dual-competition and dual liberalization of land and housing prices, in order to optimize the business environment, the shanghai municipal planning and natural resources bureau also proposed that it could provide services such as "delivery of land and certificate at the same time" and "delivery of house and certificate at the same time". as a result, dual-high and dual-competition, dual liberalization, and dual synchronization have become the three major characteristics of shanghai's current land auctions.

double high double competition

the so-called "double high and double competition" refers to two rounds of bidding and two rounds of competition for high-quality construction standards. in other words, after the bidding completes the previous indicator requirements, it will move on to the next indicator requirements, take gradient competition measures, and ultimately achieve the goals of "one site, one plan for high-quality construction" and "market-based allocation, the highest bidder wins".

yan yuejin, deputy director of the shanghai e-house real estate research institute, said that "double highs and double competition" takes into account both the relaxation of land price limits and the requirements for high-quality or "good house" construction, so it has comprehensive considerations.

according to the fifth batch of commercial housing land transfer announcement released by the shanghai land trading market on august 15, "the first round of bidding for high quality" is to incorporate universal requirements such as green buildings, ultra-low energy consumption buildings, prefabricated buildings, renewable energy, and bim technology applications into the land transfer contract. "the first round of bidding" for land plots with high market popularity will be reasonably set through a comprehensive consultation mechanism before the transfer, and differentiated premium space will be determined;

in the subsequent "second round of competition for high quality", a series of measures such as "commercial housing decoration standards", "public service facilities and public spaces", and "proportion of housing construction for high-end talents" will be selected for application and auctioned in sequence; the "second round of bidding" will be through bidding again, and the winner will be finally determined in the way of "the highest bidder wins".

compared with the previous ones, in the "competing for high quality" link, this auction added three indicators: "commercial housing decoration standards", "public service facilities" and "proportion of housing construction for high-end talents" to encourage market players to build high-quality housing, improve the public service functions and high-quality public space environment of residential supporting facilities, attract talents to settle down and develop, and create an environment quality that is suitable for living and working.

the high-quality construction orientation and specific competitive indicators of the land parcels are determined by the relevant departments of shanghai in conjunction with the relevant district governments (transferors) during the stage of determining the transfer conditions, through comprehensive evaluation and consultation mechanisms, based on the location conditions, product positioning, market conditions, etc. after the land parcels are sold, all high-quality construction requirements will be included in the land transfer contract to achieve full life cycle contract supervision such as construction, completion acceptance, and operation, to ensure that the high-quality construction requirements are implemented.

in this land auction, the competition for the caojiadu community plot was relatively fierce, attracting a total of 7 companies, including china overseas, china merchants & nantong ruicheng, xiangyu & yuexiu, poly development & shanghai construction. the lingshi community plot was bid by china construction jiuhe. according to the "double high double competition" model, the two plots determined differentiated premium space in the "first round of bidding", among which the caojiadu community plot set a 40% premium rate cap, while the lingshi community plot was set at 30%.

however, the caojiadu community plot did not trigger the second round of high-quality bidding, nor did it trigger the highest bidder wins stage. yan yuejin said that this shows that although real estate developers are active in acquiring land, they are also much more rational, and the main competitors in the land market generally maintain a rational land acquisition strategy.

chen julan, senior analyst at china index academy in shanghai, explained that the caojiadu community plot is close to jing'an temple and paramount, and is an old luxury residential area with no restrictions on small and medium-sized units. however, the plot is not square as a whole, and there is an open public passage across the plot, which may make future development difficult.

in yan yuejin's view, this land transaction in the "double highs and double competition" model has also created conditions for further optimizing the land use rules for subsequent high-quality residential properties, which will help to formulate more reasonable land auction rules and promote the construction of high-quality residential properties.

it is understood that shanghai will continue to implement the "double high and double competition" policy in the subsequent land transfers. industry insiders said that this move will help select the best developers from among the many bidding developers.

china index academy also stated that the adjustment of shanghai's land auction rules this time will help improve the efficiency of resource allocation. letting "the market return to the market" will help guide residents' expectations and restore market confidence. at the same time, "competing for high quality" will also help accelerate the construction of "good houses" and provide residents with a more comfortable and livable living environment.

land auction rules adjusted

this is not the first time shanghai has adjusted its land auction rules this year.

on june 7, the shanghai land trading market released the 2024 shanghai third batch of commercial housing land transfer announcement, and adjusted the land auction rules. specifically, the 10% upper limit requirement for the premium rate of commercial housing land has been cancelled, and the transaction price will be determined by market-based bidding, and the winner will be determined on the principle of the highest bidder. at the same time, it is proposed that differentiated regulatory measures can be taken for plots in specific areas with high market heat through decision-making, and the lottery stage will be entered after the premium rate exceeds a certain limit to guide market players to bid rationally.

at the same time, this rule adjustment has begun to include multiple high-quality indicators. the announcement stated that in order to respond to the people's new expectations for high-quality housing, the municipal departments, through comprehensive evaluation and consultation mechanisms, differentiated the high-quality construction requirements based on the location conditions of the plots, market demand and other aspects during the land transfer conditions determination stage, and included the green buildings, ultra-low energy consumption buildings, prefabricated buildings, renewable energy, bim technology applications and other requirements that need to be implemented as transfer conditions into the land transfer contract, requiring real estate developers to optimize their products and improve the quality of residential construction.

the 10% upper limit requirement for the land auction premium rate originated in 2021. the "notice on further strengthening the real estate management in the city" issued in march of that year required the deepening and improvement of the housing price and land price linkage mechanism. on this basis, the transfer of commercial residential land was subject to price-limited bidding. in april of that year, shanghai adjusted the land auction rules. under the housing price and land price linkage mechanism, each piece of land was set with a starting price, a stop price and a maximum bid. the maximum bid was generally limited to 110% of the starting price, that is, the premium rate was capped at 10%.

with the removal of the 10% premium rate cap, the popularity of popular plots in shanghai has gradually increased.

the third batch of commercial housing land transfer on july 9 was the first batch of land transfer in shanghai after the release of the "shanghai nine measures" on may 27. a total of 4 commercial housing land plots were transferred, with a total land transfer area of ​​about 15.29 hectares, a planned total construction area of ​​about 289,900 square meters, and a total transaction price of about 9.133 billion yuan. from the auction situation, a total of 13 real estate companies participated in the bidding. among them, the 9 bidders for the pingliang community plot in yangpu district sold the plot after 60 rounds of bidding, with a transaction premium rate of 21.18%; the 4 bidders for the changbai community plot in yangpu district sold the plot after 79 rounds of bidding, with a transaction premium rate of 17.12%.

on august 7, shanghai ushered in the fourth round of land auctions in 2024. among the five plots of land sold this time, the most eye-catching one was the xh128d-07 plot in xietu street, xuhui district. after 72 rounds of bidding, the land price reached the upper limit and entered the lottery stage. it was finally won by greenland with a total price of 4.805 billion yuan. the transaction floor price reached 131,000 yuan/square meter, and the premium rate reached 30%, breaking the record of the most expensive land king in china auctioned by rongsheng china in shanghai in 2016 (the floor price was 100,000 yuan/square meter at that time), becoming the national "land king" with the highest unit price.

the increase in land auction enthusiasm has obviously had a positive effect on confidence in shanghai's land and property markets.

on september 14, the latest data released by the national bureau of statistics showed that in august, the sales price of newly built commercial housing in first-tier cities fell by 4.2% year-on-year, the same as the previous month. among them, beijing, guangzhou and shenzhen fell by 3.6%, 10.1% and 8.2% respectively, and shanghai rose by 4.9%. month-on-month, in august, the sales price of newly built commercial housing in first-tier cities fell by 0.3% month-on-month, and the decline narrowed by 0.2 percentage points from the previous month. among them, beijing, guangzhou and shenzhen fell by 0.5%, 0.5% and 0.8% respectively, and shanghai rose by 0.6%.

since the beginning of this year, shanghai has coordinated the scale, structure and timing of supply, and further increased the supply of high-quality plots in areas with good location conditions, complete public service facilities, convenient transportation and strong market demand.

the head of the natural resources utilization department of the shanghai municipal planning and resources administration bureau said that shanghai is currently strengthening research from the reserve end of residential land to form a virtuous cycle of planning, reserve and transfer.

at the same time, in order to accelerate the development and listing of projects, shanghai has also launched the "delivery of certificates at the same time as land delivery" and "delivery of certificates at the same time as house delivery". in other words, if the enterprise can complete the payment of land transfer fees, deed tax payment, cadastral survey, etc. between the signing of the land transfer contract and the formal delivery of the land, it can get the property certificate at the same time as the government delivers the land. in addition, through the advance services of the registration department, tax department, etc., when the developer delivers the house, the owner can get the house key and the house real estate certificate at the same time.

no longer requiring a single project to build 5% affordable housing

it is also worth noting that the n070402 unit 094a-14 plot in lingshi community, jing'an district, and the c050301 unit 9a-20 plot in caojiadu community, jing'an district, do not need to be equipped with affordable housing.

the changes began with the fourth batch of land auctions this year. the above-mentioned "land king" project - the xh128d-07 plot in xietu street, xuhui district, broke the previous practice of land transfer in shanghai and no longer required the construction of 5% of affordable housing.

the reason is that shanghai is currently carrying out a pilot program for the monetization of affordable housing construction. combining the supply and demand relationship in the real estate market with new changes in the supply and demand of affordable housing, it coordinates the market and security, incremental and existing stocks, explores new mechanisms for the monetization of affordable housing construction, and finds a new path for the procurement of affordable housing.

according to a tweet from the official wechat account of the shanghai housing administration, the monetary matching mechanism for affordable housing refers to the physical matching of affordable housing in new commercial housing projects in accordance with prescribed proportions. based on the actual situation of the project, the funds can be converted into monetary matching funds in equal amounts and handed over to the district housing security platform agency to purchase various types of suitable existing commercial housing or second-hand houses for targeted housing security.

with the help of this pilot project, the physical affordable housing built on the xh128d-07 plot in xietu street, xuhui district, was converted into monetary construction funds. the xuhui district finance department arranged special budget funds to purchase 96 existing houses in haibo garden, longhua street, xuhui district, for use as affordable housing.

in recent years, shanghai has raised funds to supply affordable rental housing through new construction, supporting construction, reconstruction, etc. at present, in addition to the physical supporting construction model of supporting construction by individual projects and coordinated construction by districts, it is further exploring a new mechanism for monetizing supporting construction of affordable housing to form a new path for raising the supply of affordable housing.

data shows that as of the end of july 2024, shanghai has built and raised a total of 517,000 units of various types of affordable rental housing and supplied 323,000 units, accounting for 86% and 81% of the total goals of the 14th five-year plan respectively.