New Way out for Real Estate ｜ What impact will the new real estate model have on the property market？

[Editor’s note]

　The Central Economic Work Conference proposed to actively and steadily resolve real estate risks and promote the stable and healthy development of the real estate market. Improve the relevant basic systems and accelerate the construction of a new model of real estate development. How to build a new model of real estate development? What are the new outlets for China real estate in the new year?

It has been two years since the "new real estate model" was first mentioned at the Central Economic Work Conference in 2021. With the changes in the relationship between supply and demand in the real estate market, the necessity and urgency of exploring new models have further increased.

In November, 2023, Ni Hong, Minister of Housing and Urban-Rural Development, explained the "New Model of Real Estate Development" for the first time in an interview with Xinhua News Agency, which mainly expounded the ideas and considerations of building a new development model from the aspects of concept, system and mechanism and implementation.

In an interview with The Paper, the insiders said that the "three major projects" such as planning and building affordable housing are the key breakthrough directions for building a new model of real estate development. So, what impact will the new model have on the property market?

Pattern change: the housing system presents a dual-track pattern.

Recently, with the centralized construction of over 10,000 sets of allotment-type affordable housing in Fuzhou and Shenzhen, a new round of affordable housing construction was officially launched. What impact does the new round of affordable housing construction have on the property market and whether it will have a further impact on the price of commercial housing has become a topic of concern to everyone.

In an interview with The Paper, Wang Yeqiang, a researcher at China Academy of Social Sciences and director of the Real Estate Committee of China Urban Economics Association, pointed out that the new round of affordable housing construction is the perfection and supplement of China’s characteristic housing system. In the current overall downturn of the property market, the construction and investment of affordable housing will help stimulate the recovery of housing investment, expand market demand and boost confidence in the property market. Especially for the situation of oversupply in some cities and individual areas, the central government has proposed that we can make full use of the approved and unbuilt land recovered according to law, the housing and land disposed by the judiciary to raise allotment-type affordable housing, which is conducive to alleviating the structural contradictions in the current housing market.

In an interview with The Paper, Li Xiao, director of the Real Estate Chamber of Commerce of the All-China Federation of Industry and Commerce, pointed out that the new round of affordable housing construction is an important part and an important measure of the dual-track real estate model.Among them, it is marked by increasing the construction of affordable housing and the closed management of affordable housing, and it is a track to solve the housing needs of low-income groups with affordable housing; Liberalizing the land price limit as the guide, gradually liberalizing the administrative management and control as the representative, and solving the housing demand of the middle and high income groups in the market is another track of the dual-track system.

"The future housing system presents a dual-track pattern. In the future, the scale and pace of development of affordable housing will gradually be faster than that of commercial housing."In an interview with The Paper, Zhang Bo, president of 58 Anjuke Research Institute, said that in the future, under the dual-track system, the pace of construction and development of affordable housing will be further accelerated, especially in 35 pilot cities with an urban population of over 3 million. From the perspective of security objects, the focus will be on people with low income and no self-owned housing, and targeted support will be given to talents. This is an important way to solve the problem of "home ownership", but from the perspective of the construction and listing of affordable housing, the supply of affordable rental housing will occupy a high proportion in the future.

In Li Xiao’s view, "marketization, after decades of development, the market supply is very mature, and what is lacking at present is affordable housing, so the new round of affordable housing construction is accelerating to make up classes. Once the affordable housing keeps up with this track, it will have many effects on the property market. On the one hand, it is conducive to improving people’s livelihood, promoting the healthy development of the real estate market, and facilitating the stable and healthy development of investment and the real estate market. On the other hand, it can alleviate the housing difficulties of urban low-income families, solve the structural contradictions of housing, and promote the steady development of urbanization and real estate market. In addition, for areas with high pressure on stock housing, it will increase the difficulty of unsold projects. "

Concept change: commercial housing returns to "commodity" attribute

For the current commercial housing market, Zhang Bo believes that although the listing scale of commercial housing will tend to decrease in the future, the product strength will be more improved. Whether it is a private enterprise or a central state-owned enterprise, the construction of commercial housing must go beyond the original standardized products, and several sets of huxing and several community styles will play a national routine. Because commercial housing will return to the "commodity" attribute in the future, that is, the price will be determined by market supply and demand, and the per capita living area of many cities has reached a high level at present.If we can’t build better products that can meet the demand, it will be difficult to perform well in the market in the future.

In an interview with The Paper, Li Xiao mentioned that the current general policy intention is to advance according to the positioning of "dual track system". Under this great judgment, it should be a reasonable judgment that the construction and supply of affordable housing will speed up Shuang Sheng. "I think that the overall scale of the follow-up distribution-type affordable housing will be greatly improved, but it will not occupy a major position in the affordable housing system. All the affordable housing systems represented by rent-type and distribution-type will eventually complement each other and keep pace with the commercial housing system."

Among them, a prominent feature of the new round of affordable housing construction is to expand the new way of placing affordable housing. Recently, Shenzhen, Fuzhou, Nanning and other places have landed to explore allotment-type affordable housing.

Taking Shenzhen as an example, the first batch of 13 affordable housing projects with a total land area of 177,000 square meters and a construction area of 757,000 square meters were started in Shenzhen, with a total investment of about 12.5 billion yuan and a total of more than 10,000 houses. The transportation, education and business facilities around the projects are relatively perfect.

Perfecting the security system is conducive to the further marketization of commercial housing

With the start of the first batch of allotment-type affordable housing, Wang Yeqiang pointed out that allotment-type affordable housing construction is a useful supplement to the housing security system. Strictly speaking, the existing shared property houses and talent houses are allotment-type affordable housing. The difference is that the allotment-type affordable housing proposed at present adopts a closed operation mode, which is more conducive to giving full play to the housing security function. The housing system in the future will adopt the model of "guarantee+market". For the commodity housing in the market system, its price is completely determined by the relationship between market supply and demand, with ups and downs. For affordable housing, the price is much lower than the market price by adopting the principle of capital preservation and low profit.

Zhang Bo also mentioned that the relationship between affordable housing and commercial housing is mutual combination, not competition.Because there are obvious differences between the two customer groups, they can’t circulate with each other. Therefore, the improvement of the affordable housing system is conducive to further opening up the policy space for market-oriented regulation in the field of commercial housing, which will promote the development of commercial housing in the direction of high quality and better meet the middle and high-end improvement needs.Promoting the new model of real estate development will be an important measure in the next real estate cycle. In the "three major projects", the renovation of affordable housing and urban villages is closely related to the dual-track system, and it is also an important measure for the new real estate model to land in an orderly manner.

Li Xiao mentioned, "From the market perspective, allotment housing may affect the relationship between supply and demand in the real estate market to a certain extent, but the specific impact on the price of commercial housing needs to be comprehensively analyzed in combination with local market conditions and policies."

"On the land supply side, the land for affordable housing will be allocated more, and at the same time, the long-term operability of the project will be taken into account. The saleable affordable housing will be placed according to the principle of guaranteed profit and low profit, and the price will be strictly controlled during the land allocation stage. Affordable rental housing will take the form of multi-channel co-construction, which may not be completely solved by new land supply. Land involved in improving living will still be auctioned, mainly for the commercial housing market. Since the coverage groups of commercial housing and affordable housing do not overlap, more will develop in the direction of mid-to-high-end improvement in the future. To pursue buyers with higher quality and larger area, they can only choose from commercial housing. " Zhang Bo said.