This provincial capital city land auction requires "existing house sales", what signal?

　　China News Service, July 22,

　　Zhongxin Finance reporter Zuo Yukun

　　Discussions on the pre-sale system for commercial housing continue, and a new development in Fuzhou, the capital of Fujian province, has drawn attention from all parties.

　　Existing home sales are directly linked to land auctions. To what extent will Fuzhou's move affect the market?

Will it become the outpost of the next industry development trend?

Data map: Real estate real estate.

Photo by China News Agency reporter Zhang Bin

A land auction in Fuzhou requires "existing house sales"

　　According to an announcement on the official website of the Yongtai County People's Government of Fuzhou City on the 15th, the Yongtai County Natural Resources and Planning Bureau decided to sell the right to use a piece of state-owned construction land in the county's jurisdiction by auction.

　　Regarding the auction method and bidding method, the announcement pointed out that the public auction method will be adopted for the transfer of the state-owned land use right.

At the same time, the land is sold by the method of "limited land price and lottery", and the maximum price limit is set according to the premium rate of 20%, and the maximum limit price of the land parcel is 48 million yuan.

　　What attracts the most attention is that the

.

　　In addition, after obtaining the existing house sales license, the purchaser of a commercial house within five years (including five years) shall not be listed for transaction transfer, and shall not go through procedures such as notarization of transfer, if it has not been five years since the date of obtaining the real estate ownership certificate of the house.

　　The auction time given in the announcement is at 9:30 a.m. on August 5, 2022. Whether this representative plot of land can be successfully sold and its ownership will be known in half a month.

　　Although it is the capital of Fujian province, the real estate market in Fuzhou is currently under a lot of pressure to destock.

According to CRIC’s data, combined with the generalized stock, the volume of commercial housing in Fuzhou’s main battlefield exceeds 7 million square meters. According to the current sales rate, the detoxification cycle of some sectors is as high as 50 months or more, which is equivalent to 4 years for existing new houses. More to sell out.

　　In June 2021, a Fujian netizen left a message on an online platform, "It is recommended that the province cancel the housing pre-sale system as soon as possible and implement the existing housing sales system." The Fujian Provincial Bureau of Letters and Calls responded: Since 2015, the Provincial Department of Housing and Urban-rural Development has launched Research on existing home sales related topics.

The Provincial Department of Housing and Urban-Rural Development actively suggested that the state improve the legal system for the sale of commercial housing and gradually implement the sale of existing housing.

It is suggested that the natural resources department of our province should implement the sale of existing houses on a pilot basis in the conditions of land transfer.

　　In 2018, the Fujian Provincial Department of Housing and Urban-Rural Development's "Notice on Strengthening Precise Regulation and Stabilizing the Real Estate Market" also mentioned that the pilot cities of Fuzhou and Xiamen gradually improved the pre-sale conditions of commercial housing in the land transfer until the sale of existing houses.

　　It is worth noting that the relevant requirements such as "limited house price + land price" and "announced land price control limit" proposed in the above notice have been successively promoted in Fuzhou land auctions, and now the sales of existing houses appear in the land auction rules. It's an early warning.

Data map: A beautiful scene of Fuzhou under the sunset.

Photo by Wang Dongming

There have been attempts in many places, but the original intentions are different

　　From the land transfer link, it is bound to the existing house. In fact, there have been many attempts in my country before, but China-Singapore Finance has found that the pilot projects are more concentrated in first- and second-tier hot cities.

　　In 2014, 39/1 of the pure residential land in the 104th block of Wuliqiao Street, Huangpu District, Shanghai was sold for 577 million yuan.

It was mentioned in the report at that time that the fourth article of the "special agreement" made it clear that "the houses built in the plot shall not be pre-sold and must be sold as fully furnished existing houses".

　　In 2016, the Shenzhen Planning and Land Commission decided to launch the first pilot plot for the sale of existing houses-Longhua No. A816-0060 through public bidding, requiring that commercial, residential and other buildings built on this plot cannot be pre-sold. Only after completion and obtaining the real estate certificate can it be sold in the form of current sale.

　　In 2017, Guangdong Province also proposed to encourage the implementation of the existing house sales system and gradually cancel the pre-sale system in the "Implementation of the Key Tasks of the Pearl River Delta Planning Outline in 2017", but there was not much substantive implementation later.

　　In March 2020, Hainan issued the "Notice on Establishing a City Subject Responsibility System for the Steady and Healthy Development of the Real Estate Market", which is considered to be the only sign of the province that has achieved the sale of existing houses for all commercial housing in the province.

The new policy stipulates that starting from March 7, the existing house sales system will be implemented for the commercial housing built on the newly transferred land.

　　In 2021, Hangzhou will launch 10 "competitive-quality" pilot plots for the first time in the second round of centralized land auctions, all of which will be sold for existing houses, and the upper limit of the premium rate for ordinary commercial housing plots will be 15%. Can get 5% profit.

But in the end, all 10 plots were passed in.

　　In 2021, the second round of concentrated soil auctions in Beijing will also appear for the first time for the sale of existing houses – the Haihu New Village of Daxing Huangcun; the third round of concentrated soil auctions in Beijing has strengthened the regulations on “existing house sales”, and the location is the best The Jinsong plot in Chaoyang District has been clarified in the transfer requirements that all are sold as existing houses.

　　"The starting point for existing home sales in the past and now is different. Previous existing home sales were more from the perspective of preventing land plot speculation, so it was a consideration to stabilize land prices;

.” Yan Yuejin, research director of the Think Tank Center of the E-House Research Institute, pointed out.

Data map: A real estate project under construction.

Photo by China News Agency reporter Zhang Bin

Off the plan housing, each has its pros and cons

　　Under the current round of turmoil, Fuzhou's move has also triggered more thinking about the pre-sale system of commercial housing that has been implemented in my country since 1994.

　　"Existing house sales can avoid project shutdown and unfinished business, and avoid disputes between buyers and developers due to quality issues; the disadvantage is that it increases the financial pressure of real estate companies," said Liu Shui, head of research at the Enterprise Division of the China Index Research Institute.

　　Bai Wenxi, chief economist of IPG China, also said: The pre-sale system of commercial housing supports the high turnover model of real estate companies and the current real estate market scale, involving investment, construction, employment, taxation, land transfer fees and other aspects. The implementation of existing home sales will inevitably greatly reduce the financial leverage and industry scale of the real estate industry.

　　Therefore, the general voice in the industry believes that according to the current real estate market situation, it is not the best time to promote the current sales model on a large scale, but should focus on optimizing the real estate pre-sale model and steadily promoting the existing home sales model.

　　"The time point for large-scale withdrawal of existing house sales is inappropriate. The sales of existing houses will increase the pressure on housing companies' funds." Yan Yuejin believes that sporadic or pilot land supply can be tried, and localities can also follow up on individual plots. The introduction of such innovations will form more beneficial thinking on the innovation road of "EFP".

　　"The development of China's housing market is very unbalanced, and the reform of the pre-sale housing system needs to be adapted to local conditions and steadily, not one size fits all." Zou Linhua, head of the housing big data project team of the Institute of Financial and Economic Strategy, Chinese Academy of Social Sciences, also pointed out that for those who have entered the stock housing market As well as cities with high inventory, they can try to promote current sales according to local conditions, and at the same time, they can explore alternative financing channels for real estate development, such as government land credit support.

　　"For cities that do not have the conditions to promote existing sales, they can still support pre-sale, and at the same time push forward the reform of key links, so that pre-sale of off-plan properties is gradually approaching the pre-sale of pre-sale or installment in mature markets. This includes promoting the supervision of pre-sale funds. Change from administrative supervision to market-oriented supervision, and embed the reform measures of the pre-sale system into the management of land transfer contracts." Zou Linhua believes.

(Finish)