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our reporter dong hongyan reports from beijing

although the real estate market is sluggish, the market's exploration of good houses and good services continues. in recent years, people's perception of property services has changed significantly. more and more people are no longer indifferent to property services, but gradually realize the value of property services, calling for and pursuing property services that match quality and price.

in 2024, property management companies will maintain a relatively steady growth in scale and revenue in a challenging market environment. however, the growth rate of the property management industry has slowed down, and corporate profits are being squeezed out. china index academy released a research report pointing out that the property management industry is in an important stage of transition from a "seller's market" to a "buyer's market", and the voice and choice of customers and owners are becoming more prominent. in the first half of 2024, the gross profit margin and net profit margin levels of the property management industry ranked fourth and first among the eight sub-sectors of the real estate and construction industry, belonging to the high-potential and high-growth track in the real estate and construction industry.

the industry is developing against the trend, but the growth rate has slowed down

since the beginning of this year, the ministry of housing and urban-rural development has mentioned "good houses" many times. on august 23, 2024, minister of housing and urban-rural development ni hong publicly stated that judging from my country's urbanization development process and the people's new expectations for good houses, the real estate market still has great potential and space.

on september 13, 2024, at the "2024 china real estate brand value research results release conference and the 21st china real estate brand development forum" hosted by the china enterprise evaluation association, tsinghua university real estate research institute, and beijing china index academy of information technology, niu xiaojuan, head of the property research project at china index academy, said that from good communities to good urban areas, and then to good houses, the most important thing is actually good service.

the reporter of china times noticed that people's expectations for houses are no longer limited to purchasing real estate. unlike the overall downturn in the real estate market, the development of the property industry has been relatively stable in recent years, achieving counter-trend growth. according to the monitoring data of china index academy, the average brand value of leading national property service brands in 2024 is 12.145 billion yuan, a year-on-year increase of 3.78%; the average brand value of regional property service brands is 1.942 billion yuan, a year-on-year increase of 2.16%.

in the first half of the year, the performance of many property management companies was stable and they remained profitable. among them, country garden services achieved revenue of 21.05 billion yuan and net profit of 1.44 billion yuan in the first half of 2024; yuexiu services achieved revenue of 1.96 billion yuan and net profit of 278 million yuan in the first half of 2024; binjiang services achieved revenue of 1.65 billion yuan and net profit of 265 million yuan.

however, the development speed of the property industry has slowed down. according to cre property management, in the first half of 2024, the revenue of 65 listed property companies increased by 4.7% year-on-year, a decrease of 6.1 percentage points from the same period last year.

there are many reasons for the slowdown in the growth rate of property service enterprises. niu xiaojuan analyzed at the meeting that the slowdown in the growth rate of the property industry is because many companies have voluntarily abandoned loss-making and difficult-to-survive projects; there has been no significant breakthrough in the development of value-added services, including the limited support from the capital market; the influence of related parties such as real estate companies has led to a decline in profitability, including a decline in profit margins, which will also have a certain drag on the brand value of property.

in the current market environment, the brand value of real estate companies is becoming increasingly differentiated. liu shui, head of the research project of the china real estate innovation research group and director of corporate research at china index academy, told the china times reporter that the industry is continuously adjusting, and real estate companies are affected by weak demand, further declines in housing prices, and intensified market competition. sales continue to decline, and the brand value effect is evident.

transition to a "buyer's market" with high potential in the future

people's perception of property services is changing. more and more people are no longer indifferent to property services, and are calling for and pursuing property services that match quality and price. recently, cities such as chongqing and yinchuan have launched new property service fee management methods, and a large number of community owners have requested to reduce property fees based on this, and a "property fee reduction trend" has been set off.

on september 13, 2024, the china index academy provided the china real estate brand value research report 2024 to the reporter of china times, pointing out that the property management industry is in an important stage of transition from a "seller's market" to a "buyer's market", and the voice and choice of customers and owners are becoming more prominent. through the competition strategy of "high quality and low price" or "same quality and low price", the market is quickly occupied. however, in the long run, the matching of quality and price is more conducive to the healthy development of the industry.

wang yuchen, director of beijing jinsu law firm, once pointed out to a reporter from the china times that, under the premise of complying with legal provisions, reasonable property charging standards need to seek a balance between owner needs and service levels, and owner payment ability and company interest protection, thereby forming a virtuous circle between meeting community management needs and ensuring company profits, and promoting the long-term development of the property service market.

despite facing pressure from many parties, the development potential of the property industry is still optimistic. according to the analysis of china index academy, in the first half of 2024, the gross profit margin and net profit margin of the property service and management industry will be at a medium-low level overall, but among the eight sub-sectors of the real estate and construction industry, the gross profit margin and net profit margin of property services and management will rank fourth and first respectively. therefore, property management and services belong to the high-potential and high-growth track in the real estate and construction industry, and there is still broad room for development in the future.

regarding the development of property under the current era and industry environment, china index academy pointed out that in 2024, the focus of the property service market will shift from pursuing scale expansion to optimizing inventory, and companies will be given higher expectations and responsibilities. this requires companies to be more flexible in responding to market fluctuations and the negative impact of related parties, thereby consolidating market competitiveness, achieving stable growth in performance and enhancing brand value.

specifically, against the backdrop of a slowdown in the overall development of the industry, the brand value of state-owned brand companies has shown more significant growth and resilience against market downturns. according to monitoring data from the china index academy, from 2022 to 2024, the average annual compound growth rate of the brand value of state-owned brand companies represented by local state-owned enterprises and central state-owned enterprises was 12.14% and 12.33%, respectively, which is about three times the average annual compound growth rate of the brand value of private enterprises in the same period. this year, the average brand value of central state-owned enterprises exceeded 20 billion yuan for the first time, reaching 20.059 billion yuan, maintaining a stable growth in brand value under a high base.

in addition, it is worth noting that the property management industry is still in the stage of capital market revaluation, with corporate stock prices fluctuating downward and price-earnings ratios hovering at low levels. independence, dividends and governance capabilities are still the core concerns of the capital market for property companies. according to the monitoring data of china index, as of august 28, the total market value of hong kong-listed property companies was approximately 177.4 billion yuan, down about 16.2% from the beginning of the year, and the average price-earnings ratio dropped to 8.9 times; the average stock price of companies fell to less than 3.6 yuan, a further decrease of 10.9% from the low at the beginning of the year.

editor-in-charge: zhang bei editor-in-chief: zhang yuning