Shenzhen 29.4 billion epic push residential land as the main theme, housing prices to fall?

 Shenzhen 29.4 billion epic push residential land as the main theme, housing prices to fall?

On October 23, the Shenzhen Municipal Bureau of planning and natural resources disclosed that eight residential land lots with a total area of over 732200 square meters were listed at the auction price of 29.4 billion yuan and will be sold publicly on November 23. Among them, 4 plots of Guangming and 1 plot of Pingshan are pure residential land, and 3 plots of Baoan and Longhua are comprehensive land, including residential land. All the plots are sold by listing with the method of double restriction and double competition.

Among the eight land lots listed, the highest starting price is Shajing a301-0575 in Baoan, with a starting price of 12.71 billion yuan and a maximum land price of 18.415 billion yuan. The land use of the plot includes commercial land, amusement facility land, residential land, park land and road land. It is worth noting that the plot will be built into marketable talent housing, allowing split sales, of which 30% need to meet the requirements of the regulatory agreement. The price of talent housing is determined by 60% of the selling price of commercial housing in the same district at the time of sale, and the maximum selling price shall not be higher than 40000 yuan per square meter.

The same as the a301-0575 plot of Shajing in Baoan, the remaining 7 land parcels also impose restrictions on future sales prices. The land use of parcel a122-0371 in Xixiang of Baoan is class II residential land + commercial land + educational facility land + green land + Road land. After the completion of the project, the average selling price of ordinary commercial housing shall not be higher than 83265 yuan per square meter. In addition, the average selling price of ordinary commercial housing in Longhua Dalang a832-0861 parcel shall not be higher than 70875 yuan per square meter.

(4 residential sites of Guangming)

Just on October 13, Shenzhen just sold four residential land, which are located in Nanshan Nantou, Longgang Baolong, Longhua Minzhi and Pingshan Malian streets, with a total starting price of 3.4 billion yuan, attracting nearly 15 real estate enterprises to participate. In addition, Shenzhen Qianhai recently launched another residential land, with an initial price of 5.622 billion yuan and a maximum price of 8.151.9 billion yuan, which will be sold in the form of double restriction and double competition on November 11.

The so-called double restriction and double competition refers to the competition for land price and house price on the basis of limited apartment type and house price. The eight residential land projects launched by 29.4 billion will also be sold according to the double restriction and double competition rule, mainly for the construction of talent housing that only rents but not for sale.

In the first half of this year, Shenzhen also launched a number of residential land, but most of them are for the construction and sale of talent housing. In addition, recently, Shenzhen Luohu, Nanshan, Baoan and Pingshan districts have started to rent talent housing, with a total of more than 5100 units. Meilian property National Research Center believes that Shenzhen is a large-scale supply of security land this year. According to statistics, nearly 13 cases of land for talents, comfortable housing and public rental (including Shenzhen Shantou area) have been successfully transferred, and Shenzhens affordable housing land has entered a large number of supply years.

Residential land is still scarce in Shenzhen

The 29.4 billion large-scale land push is rare for Shenzhen, and the last local auction feast can be traced back to June 2019. At that time, five homesteads in Baoan, Longhua, Guangming and Pingshan attracted about 80 groups of real estate enterprises to participate in the auction. Finally, all the five homesteads were successfully sold at the highest land price, with a total of 22.4 billion yuan, which broke the land market record of Shenzhen in recent 20 years, which was known as epic land auction.

Under the rule of double restriction and double competition, the limitation of housing price directly determines the profit ceiling in the future, which makes many houses hope to step back. Even so, there are still many real estate enterprises willing to pay for every residential land transfer in Shenzhen. Among the residential land launched in Shenzhen in the first half of this year, Qianhai t102-0346, with a value of 11.597 billion yuan, attracted nearly 16 real estate enterprises and 11 main bodies to participate in the bidding. After the completion of the project, the highest average price of ordinary commercial housing in the market is 107100 yuan per square meter.

Recently, the general office of the CPC Central Committee and the general office of the State Council issued the comprehensive reform pilot implementation plan for Shenzhen to build socialism with Chinese characteristics pilot area (2020-2025) (hereinafter referred to as the plan). The plan proposes to support Shenzhen to deepen its exploration in land management system and to promote mixed land use by secondary and tertiary industries on the premise of meeting the requirements of land spatial planning. In addition, we should support the revitalization of industrial land in stock, explore solutions to the problems of planning adjustment, land supply, income distribution, and land left over by history, explore the market-oriented mechanism for the development and construction of existing construction land, and improve the recovery mechanism of idle land use right.

From the content of the plan, compared with outward expansion, optimizing the structure of the stock of land will become the main means for Shenzhen to deal with the problem of land shortage. In the view of many industry insiders, the central governments granting Shenzhen greater autonomy in land use may alleviate the imbalance of land supply structure faced by Shenzhen for a long time, and the bottleneck of residential land in Shenzhen may be broken through in the future.

Liyujia, chief researcher of Guangdong housing policy research center, said that the country had some concerns about the transformation of agricultural land to construction land, especially residential land, and worried about the hollow and real estate of real economy. Therefore, the approval right of agricultural land to construction land is strictly controlled. However, Shenzhen must readjust its spatial structure in the background of industrial transformation. The increase of land use right is of great significance to Shenzhen. Wang Qifei, deputy director of Shenzhen planning and natural resources bureau, said that Shenzhen would tap the potential of land and determine the housing types reasonably.

However, the current residential land in Shenzhen is still very scarce. We will wait and see how the land feast will be like a dragon fighting for a tiger.

Looking across the country, the latest report released by E-House Real Estate Research Institute shows that the price of residential land in 100 cities nationwide from January to September this year was 5937 yuan per square meter, up 6.9% year on year. In addition, at least 14 cities across the country have issued policies to stabilize land prices. These policies involve the adjustment of bidding rules, the implementation of land price restriction guidance, the increase of residential land supply, and the strict control of enterprises land acquisition funds, which are conducive to the stability of land prices and market expectations.

This article is from Guo Chenqi, editor in charge of securities companies in China_ NBJ9931