"Malicious price reduction" has become a thing of the past, and the price limit for new house sales has been canceled in many places: real estate companies can set their own prices according to the market

The Paper

2024-08-07 08:00Published on the official account of Shanghai The Paper

Recently, the housing price of a project called "Wanhe Optics Valley" in Wuhan City, Hubei Province, has dropped by nearly 10,000 yuan, causing buyers to question this move as a "malicious price reduction". The management committee of the East Lake High-tech Development Zone, Wuhan City, Hubei Province, the government department where the project is located, replied that due to the debt dispute between the enterprise and the construction party, part of the housing workers were transferred to the construction party, and the construction party recently sold the "work to the house" at a low price in order to return the funds, with a maximum price reduction of 6,000 yuan.

At the same time, the East Lake New Area Management Committee said that the price of commercial housing shall be set independently by the developer according to the market supply and demand, and the final transaction price shall be agreed with the buyer through the contract, but shall not exceed the record price of the pre-sale plan. The adjustment of the price of commercial housing by enterprises according to market conditions is within the scope of independent operation of market entities, and does not violate the prohibitions of laws and regulations.

The surging news reporter interviewed professionals and lawyers who are familiar with real estate and said that the concept of "bad faith" cannot be defined, and the price reduction of real estate companies is a market behavior. In response to home buyers' complaints about the price reduction of real estate companies, local governments or competent departments in many places have expressed their stance on the leadership message board of People's Daily Online, which is a market behavior. However, some competent authorities said that if there is evidence to prove that the real estate company has promised not to reduce the price after the price is lowered, it is in violation.

Many governments have stated that real estate companies can independently determine the selling price

The surging news found that buyers in many places left messages on the leadership message board of People's Daily Online, saying that real estate development companies "maliciously reduced prices" and demanded compensation. In this regard, the local government has expressed its stance on the matter of price reduction or compensation.

On May 24, the People's Government of Baoding City, Hebei Province, replied to the buyers' comments that the price reduction of real estate companies harmed their own interests, saying that the price of commercial housing belongs to the market adjustment price, and the developer can independently determine the sales price according to market conditions, supply and demand, and the buyer and the developer can negotiate to determine the final sales price of each house, which is included in the contract between the buyer and the seller.

In response to the message of "in 2022, more than 20,000 yuan will be purchased on Huangge Poly Bay, and now the price of the real estate will be reduced to 13,300 yuan, and I will ask the leader to let the company return the price difference to me", Nansha District, Guangzhou City, said that "according to relevant regulations, development enterprises can enjoy independent pricing rights in combination with the actual market situation, and handle price filing or adjustment with the housing and construction department".

Some local governments have also pointed out that if the developer promises not to reduce the price, the relevant authorities will take corrective measures against it.

For example, some buyers have previously reported that the developer of the community they purchased has arbitrarily reduced the price, and the Housing and Urban-Rural Development Committee of Changping District, Beijing replied, "If the developer promises that the price of the unit will not be reduced, the public can provide corresponding evidence, and if the project is verified by our committee, there are violations in the project, our committee will take responsibility and reform measures against the enterprise in accordance with the corresponding regulations." If the public has any objections or believes that the developer has committed other infringements, it is suggested that they can also protect their legitimate rights and interests through judicial channels. ”

In May, some buyers reported that real estate developers in Zhonghai Yuzhong Yunjin Community privately sold more than 500 unsold new houses in the community in the form of "work-to-housing" at a price that was nearly 40% lower than the online filing price, and the developer refused to communicate with the owners. The Chongqing Real Estate Transaction Affairs Center proposed that "the company is required to self-examine and rectify, standardize sales behavior, and take the initiative to communicate and explain with the owners of the previous purchases".

Is there a law to follow for real estate companies to reduce prices?

Can real estate companies reduce prices independently? Regarding the issue of commodity housing prices, the Chongqing Real Estate Transaction Affairs Center said in its reply to buyers that according to Article 6 of the Price Law of the People's Republic of China, "commodity prices and service prices, except for the application of government guidance prices or government pricing in accordance with Article 18 of this Law, shall be subject to market regulation and shall be independently formulated by business operators in accordance with this Law." Article 17 of the Administrative Measures for the Sales of Commodity Housing stipulates that "the sales price of commercial housing shall be negotiated by the parties through negotiation, unless otherwise stipulated by the state".

On the other hand, the cancellation of new house sales price limits in many places is also a basis for real estate companies to adjust prices independently. On July 31, the Zhengzhou Municipal Bureau of Housing Security and Real Estate in Henan Province issued a notice on canceling the guidance on the sales price of commercial housing. According to the notice, after the study of the municipal government, the housing security department will no longer guide the sales price of newly built commercial housing, and the development enterprises will sell according to their own pricing and handle the pre-sale (sales) license (filing) procedures for commercial housing.

More and more cities have issued documents to cancel the guidance on the sales price of commercial housing. According to the statistics of the China Index Research Institute, since the beginning of this year, Shenyang in Liaoning Province, Lanzhou in Gansu Province, Zhengzhou in Henan Province, Ningde in Fujian Province and other cities have clearly no longer implemented the sales price guidance of new commodities, that is, the sales price limit has been cancelled.

Zhang Bo, president of 58 Anjuke Research Institute, believes that after the price limit is canceled, the price of commercial housing will be determined more by market supply and demand, in other words, in areas where market supply exceeds demand, real estate companies must adjust housing prices if they want to speed up the pace of project sales. Real estate companies can flexibly adjust prices according to market conditions and their own operating conditions.

A number of professionals have said that this is market behavior. Lu Wenxi, an analyst at Shanghai Zhongyuan Real Estate Market, said that the price reduction itself is a market behavior, and some places clearly stipulate that the price reduction is not less than 15% of the record price; From another point of view, the record price is not static, especially now that many local governments have canceled the price limit, real estate companies have more freedom to adjust their pricing according to market changes.

The "work-to-housing" restriction has been relaxed

The reporter interviewed a number of industry insiders and learned that under the background of the current tight capital chain of real estate enterprises, even real estate companies that have not "exploded" will settle project payments in the form of "work to housing". An insider of a central real estate company said that market-based price reductions must exist, and some of them are "work-to-housing", and these suppliers can only sell properties at lower discounts in order to realize them.

For "work-to-housing", many places have relaxed policies, and even allowed "work-to-housing" funds not to enter the supervision account, direct online signing, etc. On July 29, Jiujiang City, Jiangxi Province issued a notice on "Several Measures to Further Promote the Virtuous Cycle and Stable and Healthy Development of the Real Estate Market in Jiujiang City". The document proposes to properly dispose of "work-to-house" and "foreclosure house". After verification and confirmation by the district government and the submission of a written application, the "work-to-housing" that has not yet received the pre-sale supervision funds of the guaranteed delivery housing project is allowed to sign the contract online for the record. Strengthen the price control of "work-to-housing", and the price of online signature filing should match the average price of the community.

On July 16, the Housing and Urban-Rural Development Bureau of Hezhou City, Guangxi Zhuang Autonomous Region, issued a notice on the issuance of "Several Measures to Further Promote Housing Consumption in Hezhou City". From now until December 31, 2025, if the construction unit uses the sales proceeds of commercial housing to deduct the project payment, after the construction unit and the construction unit reach an agreement, the "work to the house" can directly carry out the online signing of the "Commercial Housing Sales Contract" for the record.

On February 6 this year, Anyang County, Anyang City, Henan Province, issued the "Interpretation of the <促进房地产市场平稳健康发展的实施意见>Policy", which proposed that "work-to-housing" online signing for the record was allowed. In order to safeguard the legitimate rights and interests of all parties to the transaction, before December 31, 2024, in principle, no more than 10% of the total number of pre-sale permits is allowed to directly sign for the record online (without depositing the down payment into the supervision account), but the invoice must be issued at the work-to-house price.

Regarding the current market reflection of the "work-to-housing" online signing price is too low, Lu Wenxi said that the "work-to-housing" is largely to revitalize assets, especially some projects that guarantee delivery.

However, some lawyers remind that there are certain risks associated with "work-to-housing".

Regarding the "work-to-housing", Wang Yuchen, director of Beijing Jinsu Law Firm, said that in the case of a tight capital chain for developers, transactions and circulation in the real estate market can be promoted through direct online signing and simplification of the process. On the one hand, this measure can alleviate the economic pressure on developers, and on the other hand, it can speed up market flow and enhance market confidence.

Wang Yuchen also reminded that the measure has certain risks for home buyers. First of all, if the supervision is not in place, it will make it uncertain whether the house can be delivered; Secondly, there may be a situation where the mortgage has not been discharged, which will affect the delivery and confirmation of the property. Many developers have already mortgaged the relevant properties, and if the relevant mortgages are not released, buyers who have purchased work-to-work houses may face difficulties in delivery and confirmation of rights in the future.

Wang Yuchen also pointed out that if the supervision of relevant departments is not in place, developers may carry out illegal operations, affecting the fairness and transparency of the market, and then affecting the stability and healthy development of the real estate market.

Yan Yuejin, vice president of the E-House Research Institute, said that for buyers who buy "work-to-house", the most intuitive thing is to reduce the price, but there may also be transaction risks. In addition, it should be noted that if real estate companies sell too much through the "work-to-house" method, there may be greater financial pressure, and buyers also need to pay special attention to the delivery of houses.