The luxury residence by the Linshui River in Luoding has already been sold for 4,600 yuan per square meter. Photo by reporter Yu Ganyong.
Real Estate Price Investigation
Third Stop of Guangdong County Series: Yunfu's Luoding
Editorial Note:
In Luoding, Yunfu, we can see a microcosm of the process of rising housing prices in a small city under the backdrop of accelerating urbanization - a large number of people from surrounding towns are flocking to the county town to buy houses, and 75% of buyers come from these surrounding towns.
Local real estate developers are full of confidence in property prices. One housing complex has raised its price three times since its launch last year. The total area of real estate sold in Luoding last year reached 1.4 million square meters, an increase of 13.43% compared to the previous year. Now, the average price per square meter in this area has reached 2,890 yuan, up 26.8% year-on-year.
Written by reporters Yu Ganyong, Chen Xinyu, Bu Yu, Guan Jiayu, Zeng Huanya, and Chen Zhengxin.
Communicators Pan Zehui and Liang Fangwu. Overall coordination by reporter Chen Zhengxin.
Reporter's Observation:
Bare Apartments Selling for Over Four Thousand Yuan Per Square Meter
Currently, the average price per square meter for local housing projects in Luoding is around 3,000 yuan, with better projects exceeding 4,000 yuan.
At the Nanjiang Dijing housing complex in Luoding, the sales hall was rather quiet, with only one saleswoman present. Upon inquiry, it was learned that all units in the first phase of the project have been sold out, leaving only two high-rise units in the current "king of buildings" at 4,000 yuan per square meter for bare apartments. According to the saleswoman, the opening price of this housing complex last year was only 2,900 yuan per square meter. Most buyers are young people with local household registration, over 90% of whom are first-time homebuyers. The total price for these units starts at around 600,000 yuan.
Developer:
Three Price Adjustments Since Launch
As the chairman of Luoding City's Yindragon Real Estate Company Limited, Qu Dingqiu's three projects have indirectly witnessed the upward trend of property prices in Luoding in recent years. His latest development, Jinxiu Huating, had an opening price of 2,800 to 3,500 yuan per square meter on October 1st last year, and the selling price has been adjusted three times since then. "Each price adjustment is roughly around 3%," Qu Dingqiu told reporters. Due to the strong sales, he increased the price in November last year, but each subsequent adjustment did not affect the sales situation. Qu Dingqiu revealed that he plans for the next phase of the project to see a price increase of 10%.
Narrative:
Toll Collector Buys First Home After Working Half Her Life
Ms. Liang, who works at the Luoding toll station, purchased a second-hand apartment in the city last year. The 60-plus square meter small unit cost her more than 130,000 yuan, averaging over 2,000 yuan per square meter.
"It's good I bought a year earlier; now the price has risen by about 500 yuan per square meter." Ms. Liang told reporters that her income has not kept pace with the rise in housing prices. Last year, her monthly salary increased by only 100 yuan, and currently, she earns around 950 yuan per month. This is her first commercial property after working at the toll station for 16 years.
Ms. Liang joked that Luoding does not have relatively higher incomes like Guangzhou and other big cities. In the area, the monthly income of wage earners such as supermarket cashiers is only 700 yuan, while the minimum wage standard is only 600 yuan. Compared to the current new property prices exceeding 3,000 yuan per square meter in Luoding, everyone feels quite pressured.
Narrative:
Local Workers Have Stronger Purchasing Power Than Local Civil Servants
Mr. Chen, who works for a government agency in Luoding, bought his first commercial property in Luoding in 2004. At the time, the purchase price was 900 yuan per square meter, but now, his house has risen to 3,100 yuan per square meter.
Mr. Chen stated that compared to first-tier cities like Guangzhou and Shenzhen, the income level in Luoding is relatively low. "Like us civil servants, our total income is only 2,000 yuan per month. But now even decent houses are nearing 4,000 yuan per square meter." Mr. Chen mentioned that among local buyers, apart from civil servants, doctors, and teachers, the majority are migrant workers who earn money outside but cannot afford homes in first-tier cities. They choose to rent in their working cities and then buy a commercial property in Luoding for their children's education and parents' retirement. Many relatives of his earn four or five thousand yuan per month from working outside and consider returning to buy property locally.
Analysis: Three Questions About Luoding's Real Estate Market
Who Is Buying Houses?
Who are the main groups purchasing properties in Luoding's real estate market? It is understood that villagers moving from towns to urban areas are the main force.
Another housing complex's sales results show that only 25% of buyers are residents of Luoding's urban area, while 75% come from Luoding's 20 towns and other cities within and outside the province.
Why Are Prices Rising Quickly?
"The rapid rise in property prices is mainly due to the significant increase in construction materials and land costs," said Mr. Liao, assistant at Triumph Real Estate Co., Ltd. Comparing this year's construction material costs to last year, some building material prices have doubled. Additionally, there has been an increase in construction workers' wages. "These costs will ultimately be passed on to homebuyers," said Qu Dingqiu. Moreover, the rise in land prices has also become a driving factor for the increase in housing prices.
Will Prices Continue to Rise?
"For the direction of Luoding's property prices this year, the industry basically agrees on a range between 10% to 15%, as costs have increased," a developer frankly admitted. Currently, the national purchase restriction policy has little impact on third-tier cities. "On the contrary, due to requirements like tax certificates, some who originally planned to buy in places like Zhaoqing may now return to buy locally."
Housing Authority: Planning to Build 500 Affordable Housing Units This Year
"The current housing prices in Luoding are basically reasonable and within an affordable range," said relevant officials from Luoding's Housing Reform Office under the Housing Management Bureau. According to them, Luoding plans to increase the supply volume in the real estate market this year and conduct regulation based on supply and demand. Secondly, according to the provincial and municipal breakdown of affordable housing construction tasks, Luoding plans to build 500 units of affordable housing this year, which is several times more than last year's task of 100 units.
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