In 2018, China's real estate 10 key words! What have we been through this year.

2018 is coming to an end. For real estate people, this is an extraordinary year.

The logic of the real estate industry is undergoing tremendous changes, and a lot of things used to be completely subverted!

At the same time, many real estate people's lives have been completely changed... Everyone is asking, what is it that determines our destiny?

Ming Yuanjun summed up 10 key words of China's real estate in 2018 and reviewed the ups and downs of the year together with you.

01

Live on

After the industry benchmark Vanke shouted "live" three words, all the housing enterprises were startled into a cold sweat.

In fact, the key lies not in who "can't live", but in what can "live" real estate enterprises get from "can't live" real estate enterprises.

Whether it is "turning point", "silver age" or "survive", after each shock, a large number of small and medium-sized Housing enterprises will voluntarily withdraw from the real estate industry, which also becomes a good opportunity for giants to acquire and merge.

According to the statistics of the Zhongzhiyuan, Vanke ranked first in the country in January-November 2018 with a land-holding amount of 125 billion yuan.

Yu Liang recently responded that Vanke has always been a company with a strong sense of hardship. "Living is an internal matter, accidentally leaked onto the Internet, which has aroused widespread concern and caused great distress, and Vanke fired three employees." We just want to make ourselves uncomfortable, not others uncomfortable. Vanke is confident that its target of repaying 630 billion yuan this year will be achieved.

02

Slow down

How many months is the limit of fast turnover? In the first half of 2017 and 2018, this is a hot topic in the industry.

Previously, there were two modes of real estate: one was fast turnover; the other was to spend a relatively long time making high-quality goods, through high premiums to achieve profits, you sold 20,000 in six months, I sold 30,000 in 10 months, and the profits were similar.

However, after the introduction of the price limit order, the best mode of real estate seems to be only the fast turnover.

Project design is entirely based on replication, construction on the day of filming, and pre-sale begins as soon as it comes out, even without positive or negative zero. The market opens in 4 months. Project progress is directly linked to employee income.

Project design is entirely based on replication, construction on the day of filming, and pre-sale begins as soon as it comes out, even without positive or negative zero. The market opens in 4 months. Project progress is directly linked to employee income.

Project design is entirely based on replication, construction on the day of filming, and pre-sale begins as soon as it comes out, even without positive or negative zero. The market opens in 4 months. Project progress is directly linked to employee income.

The answer seems to be only two:

1.In fact, the quality of projects in other housing enterprises is not as good as those of these giants.

2.Customers buy not the house itself, but something else attached to it.

In the midst of all the criticism, everyone began to "slow down".

The key is not to "slow down" now, but to "slow down" what to do afterwards.

If the housing enterprises can not find a new business model, they can not turn time into wealth. If time only means an increase in financial costs, the ultimate "fast turnover" will come back.

03

Urban operation

City operation is a mode of making "slow" money.

Mingyuanjun believes that the essence of urban operation is that housing enterprises in relatively undeveloped areas, take a larger piece of land, long-term operation, in the process of gradual development of the region, to obtain long-term dividends.

There are two prerequisites for the establishment of this model:

1. Developers have lower financial costs and are not afraid of holding for a long time.

2. Developers have the ability of industry and operation, which can make the property they own continuously appreciate, and at the same time promote the appreciation of land in some areas.

Jinmao summarizes three urban operation modes, as shown in the following figure:

Among them, Meixi Lake, the representative project of the "New City" model, is a piece of land at the Yuelu of Changsha. Before Jin Mao's stationing, we only knew that the local grapes were produced, which is the feeling of wasteland. But after 10 years'construction of Jin Mao, the whole region is totally different:

1.The house price in Ximeixi Lake is already the highest in Changsha.

2.The matching of Ximeixi Lake has been perfected.

This mode of urban operation, although the pre-occupied funds are relatively large, but the entire development rhythm of Housing enterprises themselves can grasp

After regional development, dividends can be obtained by housing enterprises, and there is continuous cash flow, which can resist risks.

Nowadays, the town that everyone is keen on is essentially a form of city operation.

The profits of small towns mainly come from:

Rent + Service Income + Property Value Added + Investment in Enterprises + Government Policy Subsidies Return.

Apart from selling property, there are also many projects operated in cities that hold property in the form of industry, commerce, housing and so on.

After rental service income is relatively stable and property value-added reaches a certain level, it can be realized through the following channels:

1.Equity liquidation through direct transfer;

2.Equity liquidation through stock market, financial products, asset securitization...

04

Regional deep tillage

Previously, the risk of deep cultivation in the region was very high, and the biggest risk was to encounter national regulation.

If a project of a real estate enterprise is concentrated in a certain area, once the region suddenly encounters large regulation, it falls to the bottom of the cycle, which is equivalent to being a pot end.

Now, this risk has been significantly reduced.

Existing regulation has indeed been effective. The overall housing market has cooled down, and no additional regulation is needed to curb the overheating of the housing market. The probability of introducing a national regulatory policy in the next year or more is very small.

Land is still the most important financial revenue in most areas, especially in the cities on the 34th, 55th and 6th tiers. Local governments are very familiar with the local property market and will not arbitrarily regulate it.

After eliminating the risk of regulation, the regional deep tillage Housing enterprises have the following advantages:

1、Calculate the general ledger together with multiple plots, so that the development rhythm is flexible and can be fast or slow.

Foreign Housing enterprises get the landlord, and then encounter the downturn of the industry is hot potato. But for the regional deep farming housing enterprises, the land king is only one of 10 plots, which may lead to the premium of the first nine projects and accelerate the decomposition. The landlord himself can put it aside and develop other pieces first.

2、Small management radius and controllable project schedule can ensure cash flow safety.

3、The slowdown of foreign housing enterprises'land acquisition will release more space for local enterprises.

In the first 10 months of this year, the land investment of top 100 housing enterprises is generally weaker than that of last year, tending to be conservative. For unfamiliar and uncertain land, they would rather miss it than settle it. For regional deep tillage housing enterprises, there is more choice space.

4、Locally influential or light assets

The real estate enterprises that can plough deeply for many years in a place must have good fame and loyalty. Besides their own development, they can reduce the financial pressure while expanding the scale through agent construction and small-stock manipulation.

For example, in 2017, 7 billion ￥of Jianye's sales came from light assets cooperation projects in county and prefecture-level cities. Ningxia Zhongfang Group also has many light assets cooperation projects.

05

Borrowing money is hard

It is said that the cost of borrowing money by several top 100 housing enterprises has reached 15 or 16 points recently. It's really expensive, but if it's really urgent, there's no way.

In the environment of deleveraging, even if there is some liquidity of directional investment, it is also required to help the real economy, which has nothing to do with real estate.

But the debt of the real estate enterprises is concentrating on maturing.

From 2015 to 2016, the policy was loose and the market was booming. According to Wind's statistics, the whole real estate industry issued 1434 bonds in the past two years, with a total amount of 1668.637 billion yuan. As shown in the following figure:

Now, these debts, together with short-term debts in 2017, are coming to maturity.

How can I borrow cheap money? Ming Yuanjun recently asked a lot of real estate bosses and concluded that:

1.Home companies with good reputation and record in the capital market can reduce their financial costs by improving their ratings

2. Real estate enterprises with high quality and continuous cash flow can borrow cheap money through asset securitization and equity financing.

3.If the former two are not available, we can only accelerate the project sales repayment. Not really, I had to sell several projects to survive.

06

Difficult to hand in

In 2018, housing delivery is a difficult problem, and the most terrible thing is the owner's right protection. There are two reasons for the owners to protect their rights:

1. Consider that the house has quality problems;

2. The price of the house has been reduced, and the old owner protects his rights.

Housing quality problems, the larger reason is that the price limit order, on the one hand, to control costs, on the other hand, want to speed up turnover.

And the price reduction is because the real estate enterprises can not see the hope of relaxation of regulation and control, cash flow is under pressure and have to do so.

To solve these two problems thoroughly, there are three ways in the long run:

1.In a price-limited city, when land is taken, project profits should be calculated according to the price limit, and the price limit order should not be relaxed.

2.In non-price-limited cities, profits can be realized by "medium turnover" and "high premium" under the condition of guaranteeing quality.

3.If you do more small plots and projects and sell out at one time, there will be no problem that the second issue is cheaper than the first one.

07

Rob war

As of 12:00 on November 20, 2018:

The population of Xi'an is 70,1343. Among them, there are 1156 doctors and above, 24 423 postgraduates, 219 875 undergraduates and 29062 talents. If not unexpectedly, Xi'an will be the biggest winner of China's urban "population war" in 2018.

This round of people's robbery war is mainly aimed at various local policies for talents. The following policies have been issued in succession:

1.In Hainan, full-time college degree or above can be settled in any town in Hainan. After settling down in Hainan, local residents will enjoy the same treatment for purchasing commodity housing, which is not restricted by the policy of purchasing in the restricted property market.

2.In Nanchang, full-time doctoral, master and undergraduate graduates who have been newly introduced and settled down within three years after graduation will be given a subsidy of 1500, 1000 and 500 yuan per month for three years.

3.Zhuhai has launched a new policy of provident fund loan, with a loan of up to 2.5 million yuan for high-level talents.

4. In Wuhan, after college students settle down, they not only buy houses without restriction, but also buy houses at a direct discount of 8%

5.Shenzhen, cancel paper approval documents and on-site registration links, qualified personnel, system automatic verification of "second approval" processing. In addition, they can enjoy rental subsidies, including 15,000 yuan for undergraduates, 25,000 yuan for masters and 30,000 yuan for doctors.

In the long run, the population is the decisive factor for the future development of real estate and other industries; in the short run, the increase of household registration population will objectively bring about the growth of the demand for housing.

In the short run, the population struggle is a policy struggle, and in the long run, a resource struggle.

Cities with high-quality jobs, educational resources, medical resources and landscape resources will win the final victory.

08

Rent rise

Rising rents once became a hot topic in 2018.

According to data released by China Housing Price Market Network, in July 2018, rents in 26 cities rose year-on-year. Among them, Chengdu's rent rose the most, 30.98%, followed by Shenzhen, 29.68% year-on-year. Rents in most first-and second-tier cities increased by more than 10% year-on-year. Rents in Chengdu, Shenzhen, Chongqing, Tianjin, Hefei, Guiyang, Beijing, Guangzhou, Dalian, Nanning and Harbin increased by more than 20% year-on-year.

Is this round of rising rent really the pot of long-term apartments and capital?

Capital is only a magnifying glass, the imbalance between supply and demand is fundamental, and the entry of capital only accelerates the process of rising rent.

In a market with abundant rental housing resources, if the price is the same for the landlord, renting to the apartment company or renting to ordinary tenants is the same, what will happen if the long-term rental apartment takes the house at a high price and then rents it at a higher price?

Before the company monopolized the market, high vacancy rates had consumed the company.

As Chen Jinsong said:

Thousands of laws, ten thousand laws, the first law of price.

If the supply is insufficient, the price of the other party will rise whether it is inclined to rent or purchase.

This year, the slogan policy landed in some cities. Thousands of people shook hundreds of apartments because of insufficient supply of new houses and upside-down prices of new and second-hand houses. When the new house is limited in price, it will rise in price according to the law of the market immediately after it reaches the second-hand market. The person who reaches the designated price is equal to winning a big prize.

09

Industrial Operational Capability

In first-and second-tier cities, it is becoming more and more difficult to use residential land purely for sale.

But it is easier to use industrial land, especially high-tech industrial land, around the first and second-tier cities.

Why?

1.Local governments have found that there are fewer and fewer land available for sale, while land sales and housing repairs are "a hammer sale", with little income and more to pay. If we rely on land sales revenue to maintain local finance, it is difficult to sustain, there is the possibility of food shortage.

2.To make industrial real estate, to make a little profit when selling land, and to attract some excellent enterprises, we can generate sustained tax revenue, with annual fiscal revenue, and more and more.

The following picture is a summary of the profit model and maturity cycle of residential, commercial and industrial real estate in Zhongcheng New Industry.

Comparatively speaking, the profit model of traditional residential development is the simplest, and the profit model of industrial real estate is of course the most painstaking and complex.

However, as far as the whole market is concerned, the overall scale of residential development will soon reach its peak, and the simple mode of continuing to build and sell residential buildings will become more and more passive. Stock is the mainstream market in the future.

For enterprises, although the operation of apartments, hotels, industrial real estate requires professionalism and patience, but the risk is relatively small, not afraid of regulation, there is a sustained cash flow.

And if it really works well, it may make more money in the future through asset securitization such as listing, liquidation after property appreciation, services, REITs and so on, than development. Some asset management companies in the United States have a much higher market value than developers.

And if it really works well, it may make more money in the future through asset securitization such as listing, liquidation after property appreciation, services, REITs and so on, than development. Some asset management companies in the United States have a much higher market value than developers.

Now through the industry to take land, we must really have the ability to operate the industry, but can not pretend that they have the ability.

Because, even in areas with extensive management, small towns are divided into several phases. Only when the first phase of the project is completed, can the second phase be developed. It's impossible to fool around.

In Shanghai and other places, we do not look at the stationing at all, but directly at the tax revenue. When you take the land, the local government will sign a bet agreement with you, asking you to achieve how much tax in the first year, how much tax in the second year... If it fails, the contract will be terminated and you will withdraw.

10

Product strength

Did you find that in 2018, products received unprecedented attention? Rongchuang, Xuhui, Zhongnan and so on are all making great efforts in products, and they have made considerable progress.

Why?

On the one hand, under the strongest regulation in history, the number of people buying houses is limited, and consumers are more rational and mature. Among many competitors, products with high recognition and quality can stand out.

On the other hand, in non-price-limited cities, or when the policy of price-limited cities is loosened, the excellent products of Housing enterprises can produce high premium, which makes the limited land output higher value.

Lin Zhong, chairman of Xuhui Group, believes that around 2020, the real estate industry will return to manufacturing services.

Small differences in competition will be placed very large, because the balance of competition, the homogeneity of strategy, construction and security costs cheaper than others, product premium to profit margins of 1 to 2 lead, will greatly amplify your competitiveness in the market.

This industry will bid farewell to the era of profiteering, with an average profit of 8-9. More depend on product operation, product turnover, service, quality and brand. The main demand will also be to improve demand.

On the other hand, as long as we do a good job in housing development, we can also rely solely on our ability to eat.

Feng Lun said that there is a kind of foreign companies, namely "fee developers", who have strong ability to use other people's money for development, and the rate of return is very high. They collect development and management fees, sales commissions, property management fees, and additional incentives. They do their work by their ability and keep collecting money on the way. If you have a little investment, you can make money by selling it.

In fact, at present, there are also developers who specialize in small-capitalization, construction and "eat by their ability".

In 2017, Longshi added 27 new projects, nearly 90% of which were acquired through mergers and acquisitions, commissioned development and equity participation, and did not compete for a landlord in the open market. In 2017, Longshi's shareholder equity dropped to 29% in all its own trading projects.

Greentown Management is the largest agent in China. By March 2018, the construction area of Greentown Management Agent Project has exceeded 22 million square meters, which is a considerable number and is still expanding.

Some developers believe that the small-capitalist market and agent construction model earn less because they are targeting a high-leverage, high-risk, high-speed rise in house prices.

In the case of a slow rise in house prices, in the same project, agent construction, small shareholders, and large shareholders who use high leverage, the income gap is small, or even earn more.

Accumulate strength and welcome the new real estate gold decade

After 2018, let's talk about the future.

According to Lin Zhongzhong, chairman of Xuhui Group, the core of real estate in 2019 is seven words of "stability":

They are: stable quantity, stable price, stable investment, stable leverage, stable growth, stable expectation and stable policy.

In 2020, the theme word is a "turn", and many things will change.

The theme of 2021 is "Kai", which is the opening of the new real estate gold decade.

The new cycle has three characteristics.

The first feature is steady growth.

House prices may rise by 6-8% a year, synchronizing with GDP and per capita income growth, but they may rise for 8 or 10 years in a row. Eight years later, it doubled.

The second feature is that the market is healthier and more quality, regardless of the product quality, service quality, the quality of housing enterprises, will be higher.

The third is that the rising cycle is longer and the downward cycle is shorter.

What real estate enterprises and real estate owners need to do now is to develop steadily in the next two years, exercise their abilities and accumulate strength to meet the new real estate golden decade starting in 2021.