40% drop even in the best school district… China’s real estate market worried about ‘time bomb’ exploding

As the Chinese real estate market becomes unstable, even house prices in Shenzhen, Guangdong Province, China’s largest manufacturing base, are falling.

According to Chinese economic media Caixin on the 25th (local time), as of the beginning of this month, the price of a two-bedroom 85㎡ duplex house in the Baihua area of ​​Futian District, Shenzhen City, Guangdong Province, was confirmed to be 7.35 million yuan (approximately 1.34 billion won). This is 86,200 yuan (about 15.7 million won) per square meter.

The Baihua area is considered the best school district in Shenzhen, with prestigious schools concentrated nearby. Home prices in the area peaked in the second half of 2020. At that time , the price of a small house with an area of ​​45 square meters reached 200,000 yuan (approximately 36.5 million won) per square meter, and in November of that year, a two-bedroom house with an area of ​​85 square meters was priced at 12.26 million yuan (approximately 2.237 billion won, 26.2 million won per square meter). traded

A broker explained, “House prices in the Baihua area school district have returned to the level of 2017-2018 as a whole,” and “based on the peak in 2020, it has basically fallen by about 40%.” Caixin said that the plunge in house prices in the top school districts is a microcosm of the decline in house prices in Shenzhen as a whole.

Other areas with high house prices, such as Bao’an District in the west of Shenzhen, also began to fall by more than 40% from July this year compared to when prices soared. The recent transaction price of a four-bedroom house in a luxury housing complex in Bao’an District was 10.2 million yuan (approximately 1.86 billion won). This is a 44% drop from the first half of 2021, when the price rise was at its peak.

In 2021, Shenzhen City announced the reference price for each housing complex먹튀검증 for the first time in China, and in the first half of last year, when the real estate economy was in a slump, the actual transaction price was 30 to 70% higher than the reference price. However, now there is not much difference between the two prices. Caixin said that some real transaction prices in Shenzhen are below the reference price.

Chinese real estate companies in crisis

Meanwhile, China is currently experiencing a crisis due to poor management of real estate companies. Foreign media reported that China’s real estate crisis, which began with Hengda’s default in 2021, is spreading rapidly due to the default of other super-large real estate companies such as Biguiyuan and Yuanyang.

Large Chinese real estate companies account for about 40% of China’s housing supply, accounting for a high portion of the market. However, as these companies face a financial crisis, concerns are raised that the real estate crisis in China will adversely affect the Korean economy. However, experts are diagnosing that it will not have a direct impact on the domestic real estate market.

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