The Greater Bay Area’s property market was generally stable last year, with two exceptions: Shenzhen and Zhuhai, where transaction growth was hot.
According to local media, which reported on an analysis of official data by Penguin Financial, an investment adviser, Shenzhen was the beneficiary of policymaking in Beijing. The city’s designation as a Pioneering Zone for Socialism with Chinese Characteristics boosted market sentiment, resulting in new residential floorspace of 4.5 million sqm, up nearly 25%, while 37,846 homes were sold, up nearly 27.4%.
China’s most expensive property market (after Hong Kong), however, had to cede top spot for transaction volumes to the region’s smallest city, Zhuhai. Thanks to positive commentary around the establishment of a Macau Stock Exchange, which raised the outlook for Zhuhai’s Hengqin district, the market took off. Although its population is probably less than one-fifth the size of Shenzhen’s Zhuhai added the same amount of floorspace – 4.5 million sqm, up nearly 63%, while transaction volumes doubled over 2018, at 5.09 million sqm. This ranked it first among major cities in China.
And yet, neither city was the absolute biggest in terms of floorspace sold over the year. That was Huizhou. Thanks to the “policy advantage” of having no limits on purchases – most cities have home-buying curbs such as number of properties, only for local hukou-holders, etc – as well as the sheer size of its land bank, Huizhou has been way ahead in supply and transaction volumes for several years now. The city brought about 17.6 million sqm onto the market, generating sales turnover of 15.31 million sqm, slightly down on the previous year.
Foshan followed in second place, adding 14.11 million sqm, generating 13.5 million sqm of transaction volumes, flat YoY.
Guangzhou, the region’s biggest property market, was next. In 2019, it released a whopping 80.21 million sqm of floorspace, down nearly 17%. However, transaction volumes were only 8.54 million sqm, up about 6%, as the city government implemented new measures in the way property was registered and development managed.
Dongguan’s new supply area for the year was 4.39 million sqm, down nearly 13%; the transaction area was 5.47 million sqm, up about 6%. However, it was the only city in the region that saw a sharp rise in prices, up about 12.3%. This was attributed to a low YoY base of comparison, after Dongguan had seen a sharp fall the previous year.
Jiangmen’s data, although only updated to November, indicated a struggle with oversupply. For the first 11 months, Jiangmen’s boosted supply by 7.14 sqm, up 9.8%; transaction volume was 5.50 million sqm, up just 1.4%. The supply-demand ratio is about 1.3:1.
Zhongshan’s residential market was stable last year after a hot 2018, but supply fell significantly, down 38% to 4.73 million sqm, a decrease of about 38% year-on-year; the total transaction area was 6.94 million sqm, down 4%.
Zhaoqing attracted much attention to key projects such as the opening of the Zhaogang High Speed Rail, the planning of Hong Kong City, and the establishment of Wanda Plaza, but in 2019 it added only 6.78 million sqm of residential space, down 20%. Sales of 6.86 million sqm were, however, up 3%.