(Economic Observation) Why did the housing prices in Yanjiao, the "first town around Beijing", fall for 4 consecutive years?
China News Agency, Beijing, January 14th: Why has the housing price of Yanjiao, "the first town around Beijing", dropped for 4 consecutive years?
China News Agency reporter Pang Wuji
From the "free giveaway" of houses to buyers' cut-off supply to the increase in the number of foreclosures, the Yanjiao property market will frequently appear on the Internet in 2021.
Yanjiao Town is located in Sanhe City, Langfang City, Hebei Province, just across the river from Tongzhou, the sub-center of Beijing.
Because it is only more than 30 kilometers away from the center of Beijing, Yanjiao has become the first stop for many "beijing drifters" to buy a house, and is known as "the first town around Beijing".
But over the past four years, Yanjiao has seen the biggest drop in house prices.
If you count from the highs in March 2017, a large number of real estate prices have fallen by half or more.
Statistics provided by the Shell Research Institute show that since 2018, the average price of second-hand housing in Yanjiao has continued to decline, falling by 31% in 2018, 2% in 2019, 8% in 2020, and 2% in 2021.
It is equivalent to a 43% drop in 4 years, which is close to a "half cut".
At the end of 2020, the Housing Big Data Project Team of the Institute of Financial and Economic Strategy of the Chinese Academy of Social Sciences released a ranking of housing price declines in each city in the past three years. Among them, Langfang, where Yanjiao is located, ranked first in terms of housing price declines compared with April 2017. The highs fell 46.9%.
In November 2021, the agency's data showed that Langfang was still at the forefront of the list of house price decliners, with house prices down 11.6% year-on-year.
The Yanjiao property market actually experienced a rapid rise and correction.
In 2012, the average price of real estate in Yanjiao was 7,000-8,000 yuan per square meter (RMB, the same below); while in Beijing's East Fourth Ring Road, more than 20 kilometers away, second-hand housing prices had reached 40,000-50,000 yuan per square meter. , but also face strict purchase restrictions.
The huge price difference has greatly increased the attractiveness of Yanjiao. Working in Beijing and living in Yanjiao has become the choice of many people.
Arbitrage has also attracted speculators.
Many people use leverage to buy multiple suites and wait for the appreciation to be realized.
The sharp rise in demand has caused Yanjiao house prices to "hang up" all the way. At the highest point in 2017, the unit price of houses in some communities has exceeded 40,000 yuan per square meter.
Why Yanjiao house prices continue to fall?
The turning point occurred in 2017, when Sanhe City, Langfang City, Hebei Province, where Yanjiao is located, introduced a purchase restriction policy.
It stipulates that if non-local resident households can provide a local tax certificate or social insurance payment certificate for more than 3 years, they are limited to purchasing one set of housing, including new commercial housing and second-hand housing.
However, most of the people who buy houses in Yanjiao work in Beijing and cannot pay social security in Yanjiao or Sanhe City, and few people settle here specifically to buy a house.
Demand plummeted, so house prices began to fall.
Some netizens said that they bought a house in Yanjiao in 2017, but the price of the house fell by nearly half, so they had no choice but to cut off the supply.
Many homebuyers in Yanjiao also said on social media that the price of the house has dropped from hundreds of thousands of yuan to millions of yuan compared to the time of purchase.
There are also Yanjiao homeowners who expressed their willingness to "deliver the house for free": as long as they continue to repay the mortgage, the house will be transferred directly without money.
Mr. Sun, who has lived in Yanjiao for many years, told a reporter from China News Agency that there are not many cases of supply interruptions around him, but if he enters the market at a high price point and increases leverage, he will indeed face huge losses when the house price falls.
At present, the second-hand housing price in Yanjiao is about 15,000 to 20,000 yuan per square meter, which has indeed dropped by nearly half compared to the high point.
At present, the Yanjiao property market is not expected to warm up.
According to data provided by the Central Plains Real Estate Research Center, in November 2021, 516 commercial residential units were sold in Yanjiao, a decrease of 3% from the previous month and a decrease of 11% from the same period last year.
The average transaction price was 18,500 yuan per square meter, down 7% from the previous month.
Home prices are still at their lowest levels since 2020.
Experts believe that whether Yanjiao's housing prices can get out of the downturn in the future depends on the degree of improvement of Yanjiao's local industries and public facilities, as well as the progress of Beijing-Hebei integration.
A well-developed industry is the key to attracting people.
In addition, children's schooling, family medical treatment, leisure and entertainment, etc. all need developed public facilities to meet.
Without these, it would be difficult to promote the sustainable development of the property market by relying solely on the spillover demand from Beijing.
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