The Ministry of Housing and Urban-Rural Development plans to legislate and regulate the sales of commercial housing: the price adjustment exceeds 15% within 30 days of opening. Reporting is required
Recently, the Ministry of Housing and Urban-Rural Development issued the "Regulations on the Sales of Commercial Housing (Draft for Comments)", intending to further regulate the sales behavior of commercial housing. Among them, the most eye-catching clause is"If a real estate development company adjusts its sales price within 30 days after the opening of a commercial housing project and the adjustment range exceeds 15%, it shall report to the local housing and urban-rural development authority.". This policy aims to curb developers' arbitrary price adjustment behavior and maintain stability in the real estate market.
According to the new regulations, developers must file sales plans with the competent authorities before opening and publicize prices at the sales site. If the price needs to be adjusted within 30 days after the opening, and the range exceeds 15%, it must be reported to the competent department and explained the reasons. The competent authorities will decide whether to agree to the price adjustment based on the market situation.
The background of this policy is that developers have recently "open high and closed low" sales strategies, that is, they first open high and create the illusion of hot sales, and then significantly reduce prices and promote promotions, disrupting market order. According to statistics, the national commercial housing sales area fell by 7.8% year-on-year from January to October 2023, and sales fell by 4.9%, and the downward pressure on the market increased.
| index | January-October 2023 | Year-on-year changes |
|---|---|---|
| Sales area of commercial housing (10,000 square meters) | 92,579 | -7.8% |
| Commercial housing sales (billion yuan) | 97,136 | -4.9% |
| Average residential sales price (yuan/square meter) | 10,498 | +3.2% |
Policy Impact Analysis:
1.Impact on developers:It will limit the developer's short-term price adjustment space, prompting companies to formulate opening price strategies more carefully. Some companies that rely on the "high opening and low closing" strategy may face sales pressure.
2.Impact on home buyers:It helps reduce the anxiety of buying a house caused by price fluctuations and improves market transparency. However, there may be fewer projects with significant price cuts in the short term, and buyers who need to urgently need to make more rational decisions.
3.Impact on the market:It is conducive to stabilizing market expectations and preventing large price fluctuations. However, it may reduce the sales speed of some projects and intensify the financial pressure of real estate companies.
Expert opinion:
Hu Zhigang, vice president of the China Real Estate Research Association, said: "This policy is an important measure for the Ministry of Housing and Urban-Rural Development to 'stabilize land prices, housing prices and expectations'. By regulating price adjustment behavior, we will prevent irrational fluctuations in the market."
Yan Yuejin, research director of the think tank center of the E-House Research Institute, believes: "The 15% amplitude is set more reasonable, which not only gives enterprises a certain amount of room for price adjustment, but also prevents violent price fluctuations in the short term."
| City | New house prices in October 2023 | Year-on-year changes |
|---|---|---|
| Beijing | +0.4% | +2.1% |
| Shanghai | +0.3% | +3.9% |
| Guangzhou | -0.2% | -1.0% |
| Shenzhen | -0.5% | -2.8% |
Industry reaction:
Many real estate companies said they are studying the impact of the new regulations. The marketing person in charge of a TOP20 real estate company said: "Under the new regulations, we need to set the opening price more accurately to avoid being passive in the later stage. At the same time, the competition for product strength and service strength will be more important."
The responses of home buyers were mixed. Some home buyers who need it urgently welcome the market transparency brought by policies, while investors are worried that policies may limit short-term arbitrage space.
Future Outlook:
Industry insiders expect that with the implementation of the new regulations, the real estate market will show the following trends:
1. The developer's pricing strategy will become more rational, and the opening price will be closer to the real market level.
2. The price war may decrease, and the competition among real estate companies will shift to products and services.
3. The market wait-and-see sentiment may intensify in the short term, but it will be conducive to the healthy development of the industry in the long term.
The draft for soliciting opinions is currently being solicited publicly, with the deadline being December 15, 2023. It is expected that the official documents will be issued and implemented in the first half of 2024.
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