The new crown epidemic has not weakened the enthusiasm of local land sales and real estate companies to acquire land. Official data show that in 2020, the national land-use rights transfer income was 8,414.2 billion yuan, a year-on-year increase of 15.9%, setting a record high again. In the same period, local general public budget revenue at this level was 10,012.4 billion yuan, a year-on-year decrease of 0.9%. The gap between land transfer income and it is already less than 2 trillion yuan.Spark Global Limited
This is also the first time that land transfer revenue has exceeded the 8 trillion yuan mark, an increase of nearly 1.2 trillion yuan from the 7251.7 billion yuan in 2019. Under the epidemic, local land sales revenue can still achieve such “good results”, which shows the resilience of the Chinese property market.
From 2011 to 2020, although the national land sales revenue has fluctuated slightly in the past decade, the overall trend is still upward. It has climbed from 3.3 trillion yuan in 2011 to 8.4 trillion yuan in 2020, and the cumulative land sales revenue is approaching 49. One trillion yuan, an average of nearly 5 trillion yuan per year, has contributed a lot to China’s urbanization process. Land sales revenue in 14 cities exceeded 100 billion unaffected by the new crown epidemic, the domestic land market has also cooled sharply in the early 2020s, and the supply of land and the number of transactions have dropped significantly.
According to data from the market agency-Zhuge Housing Search, affected by the epidemic in the first quarter of 2020, the land supply will be significantly reduced to 207,012,800 square meters, down 11.51 percentage points year-on-year. The planned construction area of the transaction was 158,903,400 square meters, a year-on-year decrease of 19.05 percentage points. With the gradual normalization of epidemic prevention and control, the land market has also bottomed out. According to data from Zhuge’s housing search, in the second quarter of last year, as some cities increased the supply of high-quality land, the transaction volume increased significantly. The planned construction area of transactions was 343,086,400 square meters, an increase of 18.29 percentage points year-on-year. After entering the third quarter of last year, with the introduction of property market control policies in many places across the country, the policy environment has tightened, and the supervision of superimposed financing has become tighter. The enthusiasm of real estate companies in acquiring land has declined, but it is still better than the same period last year.
Zhang Dawei, chief analyst of Centaline Real Estate, believes that in 2020, the domestic economy will fully recover, funds will be relatively loose, real estate companies will gradually increase their enthusiasm for acquiring land, and land transactions with high premium rates have again appeared in many places, and the land market continues to rise. According to data from Centaline Real Estate Research Center, in 2020 there will be 14 cities with land transfer revenue exceeding 100 billion yuan, Hangzhou, Guangzhou, Nanjing, and other four cities with land transfer revenue exceeding 200 billion yuan, and Beijing, Wuhan, etc. 10 100 billion yuan. Land sale city. The total amount of land sales in more than 33 cities across the country exceeded 50 billion yuan, setting a new historical record. The total land transfer income of the 50 major cities exceeded 4205.8 billion yuan, a year-on-year increase of 18%.
Zhang Dawei believes that whether the land market is active mainly depends on buyers. In the second half of 2020, real estate companies have begun to actively acquire land, mainly in pursuit of market size. In particular, many companies that have acquired less land in recent years have also begun to actively acquire land. The land acquisition amount of the top 50 domestic real estate companies exceeded 2.59 trillion yuan, an increase of 13.4% year-on-year in 2019. There were 30 real estate companies that acquired land amount exceeding 30 billion yuan. Due to the impact of the epidemic, the overall growth of local fiscal and tax revenue in 2020 will be weak, and the pressure on revenue and expenditure will increase. The increase in income from land transfers here will help increase the overall local “financial power” and will help reduce the risk of local debt repayment. Simply understand, local financial resources mainly include local general public budget revenue, central tax refunds, and transfer payments, and land transfer revenue.
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