What is the development prospect of China real estate industry?

Main listed companies in the real estate industry: Vanke A(000002), Poly Real Estate (600048), Xincheng Holdings (601kloc-0/55), China Merchants Shekou (00 1979), Greenland Holdings (600606) and OCT A (600606).

The core data of this paper: the development history of China real estate industry, the summary of key policies of China real estate industry, the sales area and amount of commercial housing in China, and the market share ratio of each link in the industrial chain.

General situation of industry

1, definition

The real estate industry refers to a comprehensive industry that takes land and buildings as business objects and engages in real estate development, construction, operation, management, maintenance, decoration and service. It is a leading, basic, driving and risky industry. According to different uses, it is mainly divided into residential real estate, commercial real estate and industrial real estate. Residential real estate refers to real estate used for living, including ordinary houses, apartments, villas and other real estate forms; Commercial real estate usually refers to real estate forms used for various retail, wholesale, catering, entertainment, fitness, leisure and other business purposes; Industrial real estate refers to a new form of real estate that relies on industry and takes real estate as the carrier to realize the overall development and management of land, build industrial clusters of production, learning and research, help the government improve the regional environment and enhance regional competitiveness.

2. Analysis of industrial chain: The market of industrial chain links is huge.

With the rapid development of China's real estate industry, on the basis of driving a city's GDP growth, the related industries in the real estate industry chain also grow. The industrial chain is mainly divided into three stages: upper, middle and lower. The upstream of real estate mainly includes land supply, building materials and construction machinery. The midstream industrial chain includes three links: engineering consultation (planning, survey, design, etc. ), construction and real estate development; Downstream mainly includes decoration and property management. Among them, the upstream land supply link is dominated by government departments.

Industry development process: the industry is in a period of normative adjustment.

The housing market reform from 65438 to 0998 completely opened the door to the development of China real estate market, and the real estate industry rose rapidly. With the rapid development of housing construction, its impact on the economy can not be ignored. The development of China real estate market has gone through the following stages:

(1) Germination period (1978- 1998). In the twenty years before the reform and opening up, the development of the real estate market stagnated. Although the government made many attempts at that time, the effect was not great.

(2) Initial development stage (1998-2002). 1998 marks the complete end of China's welfare housing distribution system and the official start of housing system reform and marketization. So far, the housing system in China has undergone fundamental changes. The reform of the financial industry and the intervention of foreign capital have brought financial support to the real estate industry. At the same time, the inflow of foreign capital has brought the demand for office buildings, and the supply and demand of the real estate market have further expanded.

(3) Rapid development stage (2002-2009). In 2003, the real estate industry was listed as the pillar industry of China's economy, with a substantial increase in real estate investment and rising house prices. At the same time, in view of some manifestations of the real estate market in this period, the state gradually strengthened the regulation of real estate credit, flexibly adjusted the mortgage interest rate, and promoted and standardized the development of the real estate market.

(4) Frequent regulation stage (2009-20 13). In view of the rising housing prices, the state has frequently introduced relevant regulatory policies, further strengthened differentiated housing credit policies, strictly controlled non-first-home credit policies, and curbed the demand for speculative investment in housing purchases. With the promulgation of Article 8 and Article 5 in New China, major cities have successively introduced policies to restrict purchases and loans, trying to control the excessive rise in housing prices.

(5) Specification adjustment (20 13 till now). 20 13 Long-term mechanism of real estate market points out the direction for real estate market regulation. 20 16 put forward the positioning of "living in a house without speculation". 20 18 emphasizes the comprehensive use of finance, taxation and other means to "accelerate the construction of a housing system with multi-subject supply, multi-channel guarantee and simultaneous rent and purchase". 202 1 The "new ban" on the property market proposes to strictly control the scale of the supply and demand sides of real estate credit to prevent real estate speculation from driving up housing prices. A series of policies show that the real estate industry in China will enter the stage of adjustment and standardization for a long time to come, which will be a long-term national strategy and a long-term top-level system design for many years to come.

Industry policy background: frequent regulation to ensure healthy development.

Since the establishment of the land use right transfer system in 1990s, the real estate industry in China has undergone several major policy adjustments. Generally speaking, the policy of stimulating and inhibiting real estate correspondingly stimulates and inhibits real estate investment, that is, the supply of real estate conforms to the direction of real estate regulation and control policies.

1In July, 1998, the State Council issued "Notice on Further Deepening the Reform of Urban Housing System and Accelerating Housing Construction" (referred to as "Document No.23" for short), which clearly stated that "the housing industry should become a new economic growth point" and started the housing system reform characterized by the abolition of welfare housing distribution in China. The effect of regulation has activated the real estate market that has been depressed for several years, and promoted the rapid development of the real estate industry. China's real estate market and real estate industry have entered a new development period.

In 2003, the State Council issued the Notice on Promoting the Sustained and Healthy Development of the Real Estate Market, positioning the real estate industry as one of the pillar industries to promote the development of the national economy, and clearly proposing to maintain the sustained and healthy development of the real estate industry. This policy has greatly promoted the rapid development of the real estate industry. At the same time, in order to curb the excessive rise of housing prices, the State Council and other departments issued the Notice of the General Office of the State Council on Effectively Stabilizing Housing Prices, also known as the "Eight Articles of the Old Country" and other policies to promote the healthy development of the real estate market. Under various policies, the real estate industry in China is in a period of frequent regulation.

The Central Economic Work Conference at the end of 2065438+2006 first proposed that "the house is for living, not for speculation". Since then, real estate related departments have successively issued corresponding policies, involving housing financing, home buyers' credit and so on. National and regional planning and policies also emphasize the positioning of "housing without speculation".

In 20021year, the central bank, China Banking Regulatory Commission and other institutions put forward three red line policies for housing enterprises, which began to be implemented nationwide. The three red lines are that the asset-liability ratio does not exceed 70%, the net debt ratio does not exceed 100%, and the short-term cash debt ratio is greater than 1. According to the regulatory requirements, before the end of June 2023, all the "three red lines" indicators of 12 pilot housing enterprises must meet the standards, and all housing enterprises must meet the standards before the end of 2023.

Current situation of industry development

1. The growth rate of real estate development investment slowed down.

Due to the strict control of the real estate industry by the state, the growth rate of development investment scale showed a continuous downward trend during 20 10-20 15; The growth rate of real estate development investment began to pick up on 20 16, and picked up during 20 16-20 19. Due to the epidemic situation and the overall downturn of the real estate industry, the annual growth rate in 2020 and 2002/kloc-0 began to decline. By August 2022, the investment scale of real estate development in 2022 was 9 1 trillion yuan.

In the context of the slowdown in the growth of development investment scale, housing enterprises are also facing greater sales and financial pressures. Coupled with the impact of policies such as "guaranteeing delivery", the willingness of housing enterprises to start new construction continues to decline. In 202210-August 65438, the newly started area of real estate enterprises was 85 10/00000 square meters, a sharp drop of 37% year-on-year and a drop of 39.2% compared with the same period in 2020.

2. China's commercial housing sales area and sales amount scale slowed down.

Generally speaking, during the period of 20 10-202 1, the sales area and sales amount of commercial housing in China showed an upward trend. In 20 17, the sales area of commercial housing in China exceeded1600 million square meters, and the sales amount exceeded 13 trillion yuan. 20 17

During the period of -202 1, both the sales area and the sales amount remained in a high range, in which the sales area increased slightly and the sales amount maintained a certain growth scale. As of August 2022, the national commercial housing sales area was 879 million square meters and the sales amount was 860 million yuan.

3. The asset-liability ratio of real estate development enterprises is increasing year by year.

During 20 14-2020, the asset scale of real estate development enterprises in China is increasing year by year, and it has exceeded 80 trillion yuan in 20 18. At the same time, the asset-liability ratio is also on the rise, from 77% in 20 14 to 80.7% in 2020.

4. The real estate boom index declined.

Judging from the overall prosperity of the real estate industry, the overall prosperity index of the national real estate industry showed an upward trend in 20 16-20 19 and a downward trend in 2020Q 1 year. With the gradual control of the epidemic, the overall prosperity index of the national real estate keeps rising, reaching 1 18.2% in the fourth quarter of 2020. Since the second quarter of 20021,the overall prosperity index of China's real estate has declined, reaching 98.5% in 2022Q2.

5. In 2022, *** 10 housing enterprises were thundered.

Under the background of the tightening of government macro-control in recent years, real estate enterprises are still in the process of rapid expansion and have not adjusted their business scale and expansion speed in time. Many enterprises are caught in the situation of broken capital chain, declaring a thunderstorm. At present, * * 30 real estate enterprises have declared Thunder. Among them, the crisis of Evergrande in 20021September started the collective thunderbolt of housing enterprises. 202 1, 15 Real Estate Enterprises Thunder, including listed real estate enterprises such as Evergrande, Zheng Rong and R&F; By the end of 2022 10, there were *** 10 housing enterprises in 2022, including leading housing enterprises such as WTO and Sunac.

Industry competition pattern

1. Regional competition: Guangdong and Jiangsu lead in commercial housing sales area.

Statistics from the National Bureau of Statistics show that the top five commercial housing sales areas in 20021year and 3 1 provinces and cities were Jiangsu, Guangdong, Shandong, Sichuan and Henan respectively. Among them, Jiangsu, Shandong, Sichuan, Anhui, Fujian, Hubei and Shanghai saw positive year-on-year growth. 202 1, the sales area of commercial housing in Jiangsu Province increased by 7.2%, and that in Anhui Province increased by 9.7%. The year-on-year growth of Guangdong, Henan and Zhejiang provinces was negative. In 20021year, the sales area of commercial housing in Guangdong Province increased by -6%, while that in Henan Province increased by -5%. At the same time, it can be observed that the distribution of commercial housing sales area between cities is obvious. For example, the sales area of commercial housing in Shanghai, which ranks tenth with 20210.88 million square meters, is different from that in Jiangsu Province by10.46710.00 million square meters.

2. Enterprise competition: There are many competitors in every link.

The real estate industry has complex industrial links, many market participants and different competitors in each field. By calculating the total revenue of all listed companies in 202 1, the market share ratio can be obtained. In the middle reaches, in terms of engineering consulting, Taiji Industry occupies a dominant position, with a market share of nearly one third, followed by Huajian Group,11%; In terms of architecture, China architecture occupies an absolute market position, accounting for nearly three-quarters of the market share, followed by Shanghai Construction Engineering and Shaanxi Construction Engineering; In terms of real estate development, the absolute position of leading enterprises is not obvious due to many market competitors. The top three are Greenland Holdings, Country Garden and Vanke A, among which Greenland Holdings has a market share of 8%.

Industry development prospect and trend forecast

1, adhere to the positioning and transformation and upgrading of "housing and not speculating"

Since 20 16 first put forward the concept of "housing without speculation", the national level and various provinces and cities have successively issued relevant real estate control policies to promote the healthy and sustainable development of the real estate market. The Outline of the Fourteenth Five-Year Plan for National Economic and Social Development of the People's Republic of China and the Outline of the Long-term Goals in 2035 put forward that houses are used for living, not for speculation, and we should accelerate the housing system of multi-agent supply, multi-channel guarantee and rent-and-purchase, so that all people can live in a house and have a balance between their jobs and housing. At present, 3 1 provinces, autonomous regions and municipalities directly under the central government have put forward the development goals and directions of the real estate market during the tenth five-year plan period. Among them, some areas have planned the specific goals of the real estate industry during the "14 th Five-Year Plan" period. For example, in the 14th Five-Year Plan for Urban and Rural Housing Construction and Development in Jiangxi Province, Jiangxi Province pointed out that the investment in real estate development was 654.38+0.25 billion yuan. Jiangxi pointed out that the investment in real estate development during the 14th Five-Year Plan period was 654.38+0.25 billion yuan, and Heilongjiang proposed that the per capita living area of cities and towns reached 385 square meters. Some areas have planned the development direction of the real estate industry. For example, Fujian Province pointed out in the Tenth Five-Year Plan of Fujian Province and Suggestions on Long-term Goals in 2035 that it is necessary to adhere to the principle of housing without speculation and accelerate the formation of a housing system with multi-agent supply, multi-channel guarantee and simultaneous rent and purchase.

On the other hand, as China enters the key window of carbon neutrality at the peak of carbon dioxide emission, low-carbon economy will become one of the important development opportunities for all walks of life in the future. As a key area of green carbon reduction, the real estate industry is facing a "painful period" of development model transformation. Low-carbon development is undoubtedly an important long-term logic for the economic development of the real estate industry, and it will also become a brand-new opportunity to break through the dilemma of the industry. With the help of the "double carbon" policy and digital technology, the transition to low-carbon development has undoubtedly become a new way out for the transformation of the real estate industry, and it is the key to realize the "three highs" model of "high leverage, high debt and high risk" and move towards the "new three highs" development of "high quality, high quality and high efficiency".

2. It is estimated that the real estate market will gradually recover in 2022.

In 2022, the domestic real estate market continued to decline due to the macroeconomic downturn, a new round of COVID-19 epidemic rebound, and the lagging effect of previous regulatory policies on market transmission. In the context of the accelerated downturn in market prosperity, in order to prevent systemic risks in the industry and maintain the stable and healthy development of the real estate market, since 2022, the central government has repeatedly issued a signal to maintain stability, and "guaranteeing the delivery of houses" has been one of the priorities in the second half of the year. Specific measures include setting up a "real estate rescue fund" to participate in the rescue work such as revitalizing problem real estate and helping difficult housing enterprises through asset disposal and resource integration and reorganization. However, "housing is not speculation" is still the main tone of the policy.

Under the condition of relatively stable real estate policy, the Blue Book of Real Estate: China Real Estate Development Report (No.19, 2022) predicts that the sales area of commercial housing will slow down and increase by1.7% in the whole year; The growth rate of real estate development investment decreased by 0.8%, and residential development investment decreased by 0.2% from positive to negative; In the case of rising land prices, the average selling price will keep rising slightly, with an annual increase of 2.8%.

For more industry-related data, please refer to China Real Estate Industry Market Demand Forecast and Investment Strategic Planning Analysis Report by Forward-looking Industry Research Institute.