"Overall situation better than last year" Shenzhen's real estate demand continues to be released during the Qingming holiday

Securities Times reporter Wu Jiaming

As “Silver April,” the traditional peak sales season for the housing market, has long been regarded within the industry as a “critical window” for observing market direction. In particular, just after the recently concluded March, first-tier city housing markets have turned in solid “report cards,” and the market performance during the Qingming holiday period has attracted especially close attention.

During the Qingming holiday, when the reporter conducted on-site research in the Shenzhen market, multiple newly built home sales managers and second-hand home brokerage managers all said that this year’s real estate market conditions during the Qingming holiday are slightly better than last year, and that the demand accumulated in the market continues to be released. At the same time, second-hand home residential compounds around the border crossings have become the focus of Hong Kong buyers’ property searches.

“During the holiday, Shenzhen has continued to see gloomy and rainy weather, but the project still achieved impressive sales results. On the first day of the Qingming holiday, we sold 3 units; over the entire holiday we sold more than 10 units. The overall situation is better than last year, and the company is also preparing to gradually withdraw the discount.” Near Guangyiyuan in Longgang District, a marketing manager said, “The Labor Day holiday is even more of a key ‘window period.’ We expect the overall market to continue recovering recently.”

Regarding the plan to withdraw discounts for newly built home projects, several homebuyers interviewed believe that this move is mostly a project’s “marketing talking point.” One buyer said, “We care more about the home’s quality and value for money. There are plenty of new home options in the market, so we won’t rush to decide just because of this small discount.”

Industry insiders said that since last year, the “price-reduction and selling” behavior in Shenzhen’s newly built home market is no longer a common market phenomenon. It has been concentrated only among a small number of developers under pressure from their capital chains. Moreover, some Shenzhen developers’ strategies have shifted from “seeking volume without seeking price” to “seeking volume while also seeking price.” In addition, under normal circumstances, for newly built home prices to show a broad upward rebound trend, it would typically only become apparent after transaction volumes increase continuously for six months, but the overall transaction volume for newly built homes in Shenzhen is clearly lower than that of second-hand homes.

According to data from LeJia Home Research Center, from April 1 to 3, Shenzhen’s cumulative online contract signings for pre-sold and existing first-hand residential units were 361, and cumulative online contract signings for second-hand residential units were 685. Combined, the total has already exceeded 1,000 units. It is worth noting that Shenzhen’s second-hand homes ignited the market first, becoming the core engine of this round of the “early spring” (small bullish season).

A veteran real estate agent from the Shenzhen Middle School district housing area in Luohu District told the reporter: “In the first few days before the Qingming holiday, Jinli Hao Yuan and Jiahushuidu residential compounds completed several property transactions. The transaction heat has indeed increased, but prices have not changed much for now; basically they are on par with the end of last year.” The reporter also interviewed sales managers from real estate agencies in multiple districts, and they all believed that at present the second-hand home market still relies on price support. “Trading volume picking up by offering price incentives is the prerequisite for a market rebound.” “Now homebuyers are very rational. They make a move only when the price is right, and homeowners also understand this. Many people are willing to reduce prices moderately to facilitate transactions.”

At the same time, the heat in second-hand homes around the border crossing is even more pronounced. Fu, a real estate agency worker in Yumin Village near the Luohu border crossing, told the reporter that recently, the pace of sell-through of second-hand home listings in the compound has accelerated, and it has even “topped” many institutions’ March rankings for second-hand home transaction volumes. Data from the Shenzhen Real Estate Intermediary Association also confirms this: in March, the transaction volume of Yumin Village ranked first on the citywide leaderboard for second-hand residential recorded volume.

“More than half of the clients I handle are from Hong Kong,” Fu analyzed. “The compound is right next to the Luohu border crossing, and small- and medium-sized units make up a high proportion. Combined with several years of price adjustments downward, the current appeal to Hong Kong clients is very strong.”