Third and Fourth-Tier Quagmire: Inventory Rising

iFeng: 中国三四线城市楼市深陷泥潭 库存够卖30多个月
"The current housing market into a structural surplus era, exacerbated the property market differentiation trend, hot property market in first- and second-tier cities has them looking to abandon inventory policies, while third and fourth-tier cities remain stuck in a quagmire." Centaline chief analyst Zhang Dawei said.


Weak demand and excess supply coexist, discounting the effect of inventory policy

Faced with a huge amount of inventory, this year, the central and local governments frequently increase the "dosage", the country regarded relax credit, leveraged fund utilization, reduce taxes, to accelerate the shantytowns and monetary subsidies to the inventory as a force point. But now, there has been away from the reaction between the market and policy mind, this is the stock a "disaster area" 34 cities in the land because of excess supply, weak industrial base and other reasons, inventory pressure is increasing.

General manager of the Fujian Sanming City Real Estate Development Co., Ltd. Guoxin Wu Zhaokui introduced six years, the company has developed a total of 170,000 square meters of real estate, since there are more than 80,000 square meters of inventory. Reporters saw in Fuding City, county-level city resident population of about 300,000, nearly 20 buildings selling homes, some began selling four or five years ago and still have sold less than half. Zhang Qingyun, a real estate property consultant said, "Now the average price of 5,000 yuan per square meter, can still give a 10% discount." In the city construction bureau chief engineer Jiang Xiaoming opinion, to the effect unsatisfactory, in addition to weak demand, some of the units unreasonable external reasons, there is a few years ago for the land too much too fast, resulting in dislocation of supply and demand.

China Index Research Institute analyst Liuxue Rui example, Tangshan business land turnover peaked in 2013, nearly three years turnover of land planning a total construction area of ​​35.92 million square meters, compared with an average annual sales area of ​​only 2.63 million meters, calculated according to the velocity, at the past three years sales pace it will take 13 years to deplete inventory.

Central Group Research Center Director Liu Yuan believes that three or four lines on the one hand there is excess supply of housing and land inventory is too high, on the other hand by the weak industrial base and other factors, population growth slow or even negative growth, resulting in the property market oversupply.

"Siphon effect intensifies cities, attracted a lot of four-tier cities and small towns of the population, resulting in pressure to the stock further intensified." Vice president of Nanjing University Urban Studies Hu Xiaowu that the issue of the property market can only supply side through their own adjust and improve to optimize.

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