i didn’t expect that the fourth generation of housing would have such a huge impact!
2024-09-18
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it seems that overnight, the fourth generation of housing and a new generation of quality housing emerged!- every household has a courtyard and every family has a garden
- large balcony and bay window overlooking the city
- zero public area, high floor space ratio (100%-130%)
- ready-to-move-in homes for sale, certificates issued upon delivery
the fourth generation of housing, overwhelming!as of march 2024, 24 provinces in china have launched pilot projects for "fourth-generation housing", which means that more than 70% of the provinces in china have fully implemented fourth-generation housing. in 2022, fujian's first fourth-generation housing "jianfa manyun" was unveiled. from 2022 to 2024, more than 30 fourth-generation housing projects were implemented in fuzhou. at present, more than 50 projects in and around xi'an have adopted the fourth-generation housing design.for ordinary people, the new generation of housing is certainly a welfare!counting the high gift, it is equivalent to a 20% discount on the house price. the price is low, the product is good, and the living is comfortable, isn’t that a good thing!many people believe that this is the result of high-quality development of real estate and the result of the internal competition of new houses. developers compete for limited customers and "involve" in all dimensions such as house type, supporting facilities, and gifts, "involve on top of each other", driving product innovation, design and concept innovation!however, this kind of competition may be unhealthy and is a vicious "involutionary" competition!the launch of a new generation of housing in various places, in addition to catering to the preferences of home buyers, cannot but be said to be the demand of local governments to "ensure land sales" and "ensure the new housing market."some local officials are also helpless. he told me that the reason for this policy is that the low price of second-hand housing, complete supporting facilities, and "buy and move in" have formed a comprehensive competition with new houses, and even have the momentum to replace new houses. the land cannot be sold, so they have to find a way out.some places have even introduced the policy of "delivering the certificate upon delivery of the house". now, the advantages and positions occupied by second-hand houses may be taken back by new houses.but in doing so, it hurts a lot of people involved!for example,it has harmed projects that have previously acquired land and are currently or about to be developed and sold.for example,it has hurt the already suffering second-hand housing market.more importantly, it harms policy continuity and the business environment.the competition between new and second-hand houses forces developers to upgrade to a new generation of housing, renovate second-hand housing communities, and force owners to maintain their houses well.this kind of competition is healthy!however, the launch of a new generation of housing is not the result of competition at the market level. it is the result of local governments suddenly making large-scale changes to architectural design standards, especially giving away large areas, in the absence of policy continuity and unpredictability, which creates an absolute competitive advantage.this advantage, although it has the advantage of product innovation, is more of a price advantage, that is, a price advantage artificially created by policy adjustments. moreover, in addition to the price advantage, there are also supporting facilities, apartment advantages, and low-density advantages. the combined advantages are unmatched.in this way, not only can customers be attracted, but lost customers can also be won back, thereby motivating developers to acquire land!if competition is not based on pure market factors such as product creation, operational efficiency, and cost reduction, but on factors outside the market, especially when local policies are rushing in to "guarantee the sale of land" and "guarantee the new housing market", this is not healthy competition, but "involutionary" vicious competition, which is a short-term move! why am i talking so seriously?because, if the new generation of housing is essentially "high gift, low price" and enters the market on a large scale, what will be the consequences?first,the advantage of low prices for second-hand housing has disappeared, while its disadvantages have been fully exposed, including low house ratio (around 70%-85%), high floor area ratio and older buildings.the past few years have been a peak for new home delivery. the number of second-hand homes listed is still high and will increase in the future. as a result, second-hand home owners have to further reduce prices. as a result, a full-scale "price war" has begun in the new and second-hand housing markets.secondly,the land plots sold and new housing projects developed before the new construction regulations were introduced are already difficult to sell now, and will be even more difficult to sell in the future.of course, all regions are planning to adjust the planning conditions of existing undeveloped plots and turn to high-quality residential development. but the problem is that the so-called fourth-generation housing, or the new generation of housing (some also called urban forest garden buildings), must rely on a large area to achieve functional upgrades and living improvements. once the area is large and the functions are more, even if the unit price is low, the total price will not be low.but the situation we are facing is, how many people can support this market?in recent years, despite the rise of demand for improvement and the hot sales of some luxury houses, these so-called hot sales of luxury houses are individual cases compared with the total transaction volume. most housing improvements are achieved under tight constraints, that is, limited payment ability, and can only replace compact 3-4 bedrooms (80-120 square meters). it is common to have 3 bedrooms in 80 square meters. how many people can afford the new generation of housing?i am not very optimistic about this!if people cannot afford it, the fourth generation of housing will be transformed into a "pseudo fourth generation", that is, the so-called private garden, private courtyard, fresh air system, etc. will not be realized, and in the end it will only become "high gift, high house rate" and the subsequent homogeneous competition.in homogeneous competition, the competition is about who has the lowest price!under this situation, how long can the price advantage of the new generation of housing brought by the high gift be maintained? the key is,the upcoming "price war" will make the already weak market expectations even weaker, and the already formed expectations of price drops will be further strengthened.finally, i would like to emphasize that high-quality development of real estate and the creation of new models to meet the "good or bad" housing needs of residents require a new generation of housing, but this is limited to product innovation at the market level, and policies should also support it. however, the boundaries of the policy must be clear:first,，maintain policy continuity, stability and predictability.second,consider the policy externalities, especially the harm to projects under construction, on sale, and to owners of second-hand homes.third,we cannot use the name of high-quality development to ensure land sales or the scale of new housing.in this way, we can avoid a rush into the market, which may lead to oversupply and price wars!focus on observing and interpreting real estate market policies
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