Behind the "Oolong" of Huailai canceling purchase restrictions: Housing prices in Zhangjiakou are declining

On July 2, the official website of the People's Government of Huailai County, Zhangjiakou City posted an "Instruction on the abolition of the purchase restriction policy in Huailai County posted online" (referred to as the "Instruction"), which stated, Huailai has not abolished the purchase restriction policy, nor has it relaxed controls on the real estate market.

Since Zhangjiakou became the host city for the 2022 Winter Olympics in 2015, wars over sales offices have continued. It was not until 2017 that purchase restrictions were implemented in some areas of Zhangjiakou that the market boom came to an abrupt end.

Now, with the three-year purchase restriction, Zhangjiakou’s land and house prices continue to fall. The rush for houses has turned into a rush for customers. The one with the lowest price wins the customers, which has become the "hidden rule" of selling houses. As a result, the risk of being trapped in those high-priced quilts in the past is also increasing. Under the current impact of the epidemic, the Zhangjiakou property market is also particularly sensitive to changes in purchase restriction policies.

"Document abolition" triggered speculation that Huailai County will cancel purchase restrictions

The above explanation on the official website of Huailai County, Zhangjiakou City pointed out that on July 1, online media published that Huailai County, Hebei Province had canceled the purchase restriction. The news about the purchase restriction policy for commercial housing is not true. The Huailai County People's Government abolished 7 expired documents on June 10, 2020, but it did not abolish the purchase restriction policy, nor did it relax controls on the real estate market.

In fact, the reason why this incident caused turmoil is mainly because the abolished expiration documents included the "No. 62 Document" issued by Huailai County in December 2016, which stated that If you are not a registered resident of Huailai County, you have signed a labor contract and have worked for more than 2 years, paid social insurance for more than 1 year, and have proof of tax payment, etc., you are limited to purchasing one house, and the down payment is not less than 30%. This document is regarded as Huailai’s regulations on “purchase restrictions”.

In this regard, Zhang Dawei, chief analyst of Centaline Real Estate, believes that since the documents have expired and there is no seamless connection between the documents, it should be temporarily lifted. Huailai is the 13th region in the country to adopt the "one-day tour" policy.

Huailai is the area closest to Beijing in Zhangjiakou City. Bordering Beijing's Yanqing District, Changping District and Mentougou District, it is known as Beijing's "back garden" and has taken on some of Beijing's overflow housing demand.

In 2015, Beijing joined hands with Zhangjiakou to win the right to host the 2022 Winter Olympics, which brought impetus to the rise in housing prices in Zhangjiakou. In particular, housing prices in Zhangjiakou, represented by Chongli and Huailai, began to rise.

In Chongli County, where the Winter Olympics snow events are located, individual real estate prices have jumped by more than 1,000 yuan/square meter. The unit prices of some properties for sale have also increased by 300 yuan/square meter to 900 yuan/square meter. Due to insufficient supply at the time, sales offices staged wars to grab houses from time to time.

Subsequently, a new round of real estate regulation cooled down the hot market. In November 2016, Huailai took the lead in issuing a purchase restriction policy. In December, the policy was upgraded, and the number of home buyers dropped sharply. In March and May 2017, Chongli District and the main urban area of ??Zhangjiakou issued purchase restriction policies, causing the market to wait and see, ushering in the "late spring cold".

House prices in Zhangjiakou continue to fall, returning to the level three years ago

Three years after the purchase restriction policy was implemented, why is the market sensitive to whether the "purchase restriction" will be lifted? How is the property market in Zhangjiakou? We can tell a lot from the organization’s data.

According to statistics from the Zhangjiakou Fangtianxia Data Monitoring Center, new home prices in the main urban area of ??Zhangjiakou showed a trend of rising first and then falling from 2017 to May 2020. Whether it is Qiaodong, Qiaoxi or the Economic Development Zone, from 2017 After rising from 2018 to 2018, house prices continued to fall from 2018 to 2020. The area with the largest decline was Qiaodong District. Compared with 2018, house prices fell by 2,603 ??yuan/square meter in 2020, a decrease of 17.5%. From the current point of view, housing prices have fallen back to 3 years ago.

According to rough statistics from a local industry insider, the average house price in Qiaodong District has dropped from 12,000 yuan/square meter to the current 9,600 yuan/square meter, and in the Economic Development Zone has dropped from 12,500 yuan/square meter. From the current 10,000 yuan/square meter, the price in Qiaoxi District has dropped from more than 10,000 yuan/square meter to the current 8,700 yuan/square meter, while in Xishan District, the price has dropped from 8,800 yuan/square meter to around 6,000 yuan/square meter.

It is not difficult to see from the above data that “the current average house price in Zhangjiakou has dropped significantly compared with two years ago in 2018. Since the full implementation of Zhangjiakou’s purchase restriction policy, regional house prices have averaged around 2,000 per square meter. Decline in varying degrees,” said the above-mentioned industry insider.

In fact, in September 2019, Zhangjiakou’s housing prices dropped from the original five digits to four digits. In 2020, the downward trend in housing prices will continue.

Zhangjiakou Fangtianxia data shows that both new and second-hand house prices fell in June. Among them, the average price of new houses was 9,693 yuan/square meter, down 0.48% month-on-month and 4.2% year-on-year; the average price of second-hand houses was approximately 8,004 yuan/square meter, down 0.5% month-on-month and 6.9% year-on-year. Looking at districts and counties specifically, the largest decline in new home prices was in Qiaodong District, the largest month-on-month decline in second-hand housing prices was in Huailai County, and the largest year-on-year decline was in Zhangbei County.

Monitoring data from the Zhuge Housing Data Research Center shows that the rapid recovery period after the epidemic ended in the national market has gradually stabilized. However, Zhangjiakou became the top ten cities with a month-on-month decrease in second-hand housing transaction prices, with a decrease of 0.94% and a year-on-year decrease of 0.94%. 5.59%.

From the perspective of market fundamentals, Yan Yuejin, research director of the E-House Research Institute Think Tank Center, believes that the Zhangjiakou property market, represented by Huailai, has developed rapidly, especially with the Zhangjiakou Winter Olympics, but during the current epidemic During this period, market transactions were obviously affected. Objectively, there is obvious pressure to decompose.

Land supply is opening up, and residential inventory has grown by 45% this year

Before Zhangjiakou’s housing prices fell, it was also difficult to find a house. But from 2016 to 2018, well-known real estate companies such as Country Garden, Evergrande, Poly, and Blu-ray entered Zhangjiakou one after another and started the land enclosure movement.

The fast pace of land market supply is the most obvious feature of Zhangjiakou’s successful Olympic bid in the past four years. "Too much land has been sold for four or five consecutive years, and the market is seriously oversupplied. Now there are very few foreign real estate companies acquiring land in Zhangjiakou like they did in the past two years." A local industry insider said.

According to statistics from Zhangjiakou Fangtianxia, ??in 2019, there were 891 state-owned land transfers in 19 districts and counties in Zhangjiakou, with a total transaction area of ??approximately 24,632 acres and a total transaction value of approximately 14.705 billion yuan. The number of land transactions and the area of ??land transactions have reached new highs in the past years. The total number of transactions increased by approximately 77.49%, and the total area of ????transactions increased by as high as 82.24%.

According to data from the E-House Research Institute, as of the end of May, 57 out of 100 cities had experienced positive year-on-year inventory growth. In some cities, inventory has increased by more than double digits. Among them, Zhangjiakou ranks among the bottom 10 in terms of housing price growth, but its inventory ranks among the top 10 with a growth rate of 45%.

As a large amount of land continues to be sold, and the rate of decontamination of Zhangjiakou’s property market has not been favorable, the decomposition cycle has always been a concern in the industry.

Ranking table of year-on-year growth rate of newly built commercial housing inventory in 100 cities

Land prices are no longer what they used to be, and high-priced land has become a "hot potato"

What deserves attention Yes, although the area of ??land transactions in Zhangjiakou increased significantly in 2019, the amount of land transactions showed a downward trend.

Looking back at the land market in 2018, at the end of May 2018, Poly won the Zhangjiakou Coal Machinery Factory Lot 04 for 11.21 million yuan/acre. The case is now called the Poly Central Park Project. Country Garden acquired Lot 05 of Zhangjiakou Coal Machinery Factory for 11.3 million yuan/acre, and the current project is named Country Garden Tianxi. At that time, land prices hit a new high in Zhangjiakou history.

Because of the strong land acquisition by Poly and Country Garden, there was a heated discussion at that time. The comprehensive floor prices of these two plots of land located in Qiaodong District exceed 6,000 yuan/square meter. At that time, the industry estimated house price was 14,000 yuan/square meter. According to information from Zhangjiakou Fangtianxia, ??the current average house price in Qiaodong District is 10,977 yuan/square meter.

Previously, the hot atmosphere in the local auction market gave people the impression that "as long as you can get the location, it will be fine." However, the good times did not last long, mainly due to the impact of purchase restrictions, especially in the main urban areas of Zhangjiakou, Chongli, and The purchase-restricted area in Huailai is reflected in the fact that the capital cost for real estate companies to acquire land is getting higher and higher, supervision and review are becoming more and more stringent, and the land market is getting less and less popular.

According to statistics from Zhangjiakou Fangtianxia, ??Zhangjiakou’s land transaction volume dropped by approximately 3.88% in 2019. Unlike the frequent occurrence of high-priced land in 2018, Zhangjiakou’s “phenomenal-level transaction plots” disappeared in 2019, and developers took Return to reason.

On June 30, 2020, Joy City Holdings teamed up with Jiangdu Construction to acquire three plots of land in Zhangjiakou Economic Development Zone for 873 million yuan, with a total land area of ??305 acres and a land price of only 2.86 million yuan/acre. . By comparison, in January 2019, the equivalent unit price of the land parcel on the south side of Chaoyang West Street in the development zone was 5.7444 million yuan/acre. Although the situation of land is different, it is a fact that the price changes greatly.

In fact, the land market and the property market interact with each other to curb the rising housing prices. The Zhangjiakou property market has entered the second half. And how will those high-priced land become a hot potato?

“The current Zhangjiakou market has been overdrawn in advance. In addition, Zhangjiakou’s industries are still insufficient. It is not yet a population importing city. Competition is fierce. Most of the current real estate projects adopt price wars.” Local industry insiders said this.

An analysis by Zhangjiakou Fangtianxia believes that as new housing projects bloom everywhere, customers’ competition for houses has turned into sales competition for customers, and the real estate market is moving forward hard. The one with the lowest price wins the customers has become the “hidden rule” of selling houses since 2019. .

In this regard, Zhang Dawei believes that housing prices around Beijing have dropped to suit the rigid needs of those who find it difficult to buy property in Beijing. If the city is open to settle down, it will help these people move to find jobs and buy properties.