Focus Research Institute · Soil Auction Research Report
Theme: The third batch of Wuxi centralized land supply analysis
Researcher: Zhao Wenhao
Released: November 1, 2021
Since October, the third batch of centralized land supply cities have begun to release the announcement of residential land transfer, as the first city in the third batch to issue an announcement, Wuxi today ushered in a listing bid, 20 plots of land without first-class auction, the overall performance is stable. In the environment of the overall cold market and frequent auctions in many cities, it is not easy for the three batches of Wuxi to end smoothly, which also highlights the confidence of housing enterprises in the Wuxi property market.
As far as the overall situation is concerned, the transfer policy and the second batch of centralized land use in this batch have not changed much, on the other hand, many of the land transfer plots have industrial supporting requirements, and the heat of different plates has diverged, and the land enterprises are mainly state-owned enterprises, but there have been major changes in the follow-up development method.
The three batches of soil auctions ended smoothly, and the annual floor land price rose year-on-year
On November 1, the third batch of soil auctions in Wuxi was announced. A total of 20 residential land plots were officially announced in this batch, and all of them were successfully transferred after the start of auction. The transfer area of the land parcel was 1.1374 million square meters, a decrease of 6% compared with the second batch, according to The 2021 Residential Land Supply Plan of Wuxi, the annual planned supply is 3.56 million square meters, and the cumulative supply of the first three batches is 3.2644 million square meters, with a completion rate of 92%. The gross floor area of the land parcel was 2,076,800 square meters, down 5% from the second batch, the total transaction price was 27.385 billion yuan, an increase of 4% over the second batch, and the floor price of the measured floor was 13,186.07 yuan / square meter, an increase of 10% over the second batch. The annual land price of residential land transaction volume was 13262.44 yuan / square meter, an increase of 8% over 2020, which shows that the effect of Wuxi's implementation of the centralized land supply policy to stabilize land prices is not obvious.
Source: Wuxi Public Resources Trading Center
Focus Research Institute collation
From the perspective of various administrative districts, the three batches of land transactions in each municipal district of Wuxi have been traded, and from the perspective of sub-regions, the transfer area, the gross floor area, the total transaction price and the floor price of the measured floor in Binhu District rank first among all administrative districts. From the overall situation of the whole year, Binhu District and Xishan District have the largest land supply area, and the follow-up will become the main force in the supply of new houses.
The rules of the soil auction have been slightly adjusted, and 7 parcels have special requirements
The first batch of centralized land supply in Wuxi most of the plots adopted the transfer method of limited land price + bidding for rental housing area + lottery number, and the second and third batches adopted the bidding method of limiting land price + lottery number, and adopted the bidding rules of prohibiting vest enterprises from participating in the auction in terms of land purchase threshold, and participating enterprises must have real estate development qualification requirements. It is worth noting that in view of the source of own funds, the provisions are more detailed, and the three batches require the provision of audited corporate financial statements and the declaration form of the source of funds for the purchase of residential land.
According to the data of the Focus Research Institute, Wuxi has a total of 7 plots with special transfer conditions, mainly involving the commercial proportion, self-sustaining leasing and the introduction of foreign capital and other requirements, Wuxi such transfer methods are mainly for popular plate plots, through the construction of special industries can appropriately reduce the average price of land plots, prevent land prices from rising too fast, and effectively stabilize the land price. On the other hand, commercial formats can enliven the local area and facilitate subsequent land transfer and development. In addition, this will undoubtedly require higher operational capabilities, raise the auction threshold, and help reduce the overall premium rate.
The overall premium level has declined, and the plots in different regions have diverged
In this batch of Wuxi centralized land supply, 17 of the 20 plots were traded at the reserve price, and only 3 were delivered at a premium, with an overall premium rate of 0.05%. Compared with the second batch of 9 plots of land lottery transactions, the overall premium rate of 4.1%, the overall concentrated heat of land auction gradually turned cold.
According to the data of the Focus Research Institute, the growth rate of real estate funds in place continued to narrow, and the funds in place for real estate development enterprises in 1-9 months increased by 11.1% year-on-year, and the growth rate fell by 3.7 percentage points compared with 1-8 months, and the decline continued to be large. Among the 26 leading housing enterprises, only 3 of the sales from January to September reached the annual sales target, and the pressure on sales financing made the housing enterprises face greater operational pressure. In the face of policy uncertainty, housing enterprises generally tend to be conservative and cautious in taking land, and it is expected that this trend will continue.
Only 3 plots were traded at a premium in this batch, namely Plots 53 and 55 in Liangxi District and Plot 62 in Binhu District. Judging these 3 plots, we can know that the surrounding area is complete, the total price of the plot is low, the surrounding new housing projects are better, and the good land conditions make the plot premium. Most of the corresponding plots have only 1 registration, and the reserve price is sold.
Local state-owned enterprises in Wuxi actively acquire land, and government-enterprise cooperation participates in cooperative development
Observing the list of enterprises that have obtained land this time, it can be seen that most of the enterprises that have obtained land are local state-owned enterprises, and local state-owned enterprises have played a major role in supporting the bottom, and in the current market downturn, state-owned enterprises have played an obvious role in stabilizing market confidence.
The first batch of concentrated land supply of real estate enterprises in Wuxi is mainly large-scale housing enterprises, the second batch is almost equal to the list, three batches of local state-owned enterprises to get land 15 cases, state-owned enterprises occupy the dominant pattern of land acquisition, which is inseparable from this year's gradually heating up the form of regulation and control, the market environment facing large-scale housing enterprises is increasingly difficult, local state-owned enterprises have relatively financial advantages, so the land gradually becomes more.
A number of sources in the industry pointed out that a number of large-scale housing enterprises will participate in the development of the project in the future. Large-scale housing enterprises have strong development and operation capabilities, but the shortage of funds, local state-owned enterprises have financing advantages, the combination of the two can combine their respective advantages, such a way of obtaining land may be able to provide reference for other centralized land supply cities.
Judging the sales list of housing enterprises in the past two years, it can be known that the sales amount of national housing enterprises in the Wuxi real estate market is in the forefront, and the gradual changes of land-taking enterprises in Wuxi in 2021 will inevitably lead to major changes in the subsequent new commodity residential market.
New housing transactions were under pressure in the second half of the year, and new housing projects were intensively listed
According to the data of the Focus Research Institute, the transaction situation of new commercial residential buildings in Wuxi reached its peak in June this year, and in the second half of the year, it was in a downward channel, and the transaction volume in September reached 408,600 square meters, a decrease of 18% month-on-month, and the average transaction price was 21587 yuan / square meter, which was basically flat month-on-month. Since the second half of the year, the deindustrialization cycle has continued to remain around August.3, down from the first half of the year. According to the incomplete statistics of the Focus Research Institute, there are 15 new projects in Wuxi City at this stage have been announced, and another 16 plot plans have been announced, with the supplement of follow-up inventory, Wuxi new housing market is facing greater pressure to decentralize, which also indirectly affects the enthusiasm of housing enterprises to obtain land.
Source: Focus Institute
Data source: Wuxi Public Resources Trading Center, collated by Focus Research Institute
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