Land transfer funds hit a new high
Among the commercial land currently listed by the Beijing Municipal Bureau of Land and Resources, only the retail commercial land at No. 3, Fanjia Village, Fengtai District, will be sold on December 30, and the remaining land parcels will be sold in 2015. The price of Land 3 in Fanjiacun starts at 550 million yuan. At the same time, no industrial land was sold during the year. At this point, the Beijing land market in 2014 will officially end after the sale of Fanjiacun Land No. 3. If Fanjiacun No. 3 land is successfully completed, Beijing's annual land transfer fee is expected to be around 192 billion yuan.
In this regard, Zhang Dawei, chief analyst of Centaline Real Estate, analyzed that the Beijing land market set a number of records in 2014. Among them, the total transaction volume and residential land transaction volume (131.1 billion yuan) reached new highs, and the average floor price of residential land was as high as 14,557 yuan/square meter, which is a 51% increase from the previous year’s 9,616 yuan/square meter in 2013.
In contrast, the floor price of commercial and financial land has dropped from 9,596 yuan/square meter last year to 8,491 yuan/square meter, a decrease of about 11.5%.
"Last year's enthusiasm in the land market has been carried through to this year." Guo Yi, the marketing director of Yahao Institution, also told reporters. "Due to the enthusiasm of the property market last year, many real estate companies have accumulated a lot of funds and land is in short supply. This has caused this year. In the first half of the year, competition in the land market was fierce, and the premium rate was generally high. This is also one of the reasons why the Beijing land market data this year exceeded that of last year."
According to statistics published by the Beijing Municipal Land Consolidation and Reserve Center, in the first four months of this year alone, Beijing’s land transfer fees have reached 105.5 billion yuan, accounting for 55% of the current total land transfer fees in Beijing.
Land grab parallel with streaming
In fact, due to the impact of multiple factors such as policies, markets, and land supply, the land market in 2014 has gone through many ups and downs. At the beginning of the year, there were frequent high-priced land in the land market, but there was a break for a hundred days in the middle, and the high-priced land in Sunhe went unsold twice. Although the land market transactions have surpassed last year's total so far, it cannot conceal the weakness of the land market in the second half of this year.
Many industry insiders believe that the main reason for the high turnover in the land market this year is due to the concentration of a large number of high-quality land parcels into the market. For example, the Xiju plot taken by Tahoe at the beginning of the year and the Liuniang Mansion plot in Shijingshan, which entered the market in September, have triggered fierce competition among many real estate companies. The Huajia Hutong plot, which was temporarily suspended from entering the market and finally sold until August, became the land king in Beijing this year with a total price of 7.46 billion yuan and a floor price of nearly 97,000 yuan per square meter.
However, it is also worth noting that not all high-quality land has been looted. In the third quarter when the property market was the most deserted, the land market was even more unsuccessful. The Sunhe sector, which was originally optimistic by many developers, ushered in a dramatic reversal this year. In July, the initial floor price of the K plot in Sunhe area was 35,000 yuan per square meter, setting a record for the starting bid price in Beijing. In the end, it was unsuccessful because of no bidding; the dramatic thing is that when this land was sold out again in September this year, it still failed to welcome buyers as expected. In addition to Sun He's "Quasi Land King", there are also some other plots, such as those located in Changgou Town, Fangshan District, which have also encountered unsold auctions.
In this regard, some people in the industry said that this year’s land auctions mostly occurred in the third quarter. At that time, the property market was bleak. "Destocking" was the main task of real estate companies. The large-scale acquisition of land would undoubtedly increase the cost of capital. The main reason that caused many pieces of land to pass the auction.
With the introduction of a series of credit policies at the end of September, the land market in Beijing has heated up again. After the introduction of the New Deal, many real estate companies have renewed their attention to the land market and are actively preparing to acquire land. Taihe Group (000732, share it) brand director Shen Linan also bluntly told reporters in an interview, "The introduction of the New Deal can be said to let real estate companies smell the breath of spring."
The reporter observed that since the "September 30 New Deal for Loan Limitation" was proposed, the land market in Beijing has significantly warmed up compared to September. From October 13th to 28th, within half a month, there were a total of 10 successful land transfers, with a land transfer fee of 19.78 billion yuan. Compared with 9.693 billion yuan in September, the month-on-month growth rate exceeded 100%. Zhang Dawei pointed out that land prices in first-tier cities will continue to run at a high level in the future. "Compared with the visible risks in third- and fourth-tier cities, real estate companies are more clustered in first-tier cities. In this case, fierce competition in the land market in first-tier cities is inevitable."
"Big Mac" plots start at over 7 billion yuan
The land market in 2015 may open with a high profile. The land plot in Baipenyao Village on the South Fourth Ring Road starts at more than 7 billion yuan and is expected to be sold on January 7 next year. In 2014, only the Huajia Hutong plot in Xicheng District in Beijing had a transaction price of more than 7 billion yuan. At present, according to the reporter's understanding, many real estate companies, including Vanke, are paying attention to the Baipenyao plot.
Total price threshold will test the strength of real estate enterprises
The Baipenyao plot outside the South Fourth Ring Road is located on the Guogongzhuang block outside the South Fourth Ring Road. One or two kilometers west is the Beijing Investment Vanke West Huafu Project and Zhonghai No. 9 Mansion.
From the perspective of market demand, the Guogongzhuang sector has become a hot spot in Beijing's property market after China Shipping, Beijing Investment and Vanke have entered one after another. According to statistics from Yahao Agency, as of December 20, the Beijing Investment Vanke West Huafu Project achieved sales of 2.952 billion yuan in 2014, ranking second among major residential projects in Beijing.
Although the Baipenyao plot has obvious geographical advantages, it is not easy for real estate companies to earn income. With large plots and high total prices, the capital threshold will be the first issue facing real estate companies.
The initial total price of the land is 7.07 billion yuan. Even if the premium rate is only 20%, the total transaction price will exceed 8.4 billion yuan. The general manager of a real estate company in Beijing told reporters that due to the pressure of capital costs, it is unlikely that a real estate company will acquire land alone, or a very small number of real estate companies will choose to fight independently. The greater possibility is that large real estate companies form a joint venture. Obtain land individually to diversify capital pressure and market risks.
Limited profit expectations
The planned construction area of the Baipenyao plot is about 419,000 square meters, of which 163,300 square meters of limited-price houses and 122,600 square meters of self-occupied commercial houses need to be built. The sales limit of the former is 17,000 yuan per square meter. The seller’s sales limit is 29,000 yuan per square meter. This also means that the Baipenyao plot will be equipped with the most expensive self-occupied commercial housing in Beijing.
In addition to building price-limited houses and self-occupied houses, after deducting 6,880 square meters of educational facilities, the remaining common commercial housing available for sale on the Baipenyao plot is up to 126,000 square meters. The floor area ratio of commercial residential buildings is 2.8, which, in the eyes of the industry, restricts the future residential properties of the Baipenyao plot, and it is difficult to develop into higher-end low-density residential buildings. In the future, it will generally be a product that just needs to be renovated in the future. "The price-fixed housing part is definitely a loss, and the owner-occupied house will have a slight surplus. The overall profit margin is limited." The general manager of a real estate company told reporters.