Recently, the CPC Development and Reform Commission issued a notice on “Key Tasks of New Urbanization and Urban-Rural Integration Development in 2021”. The document mentions: strictly limit the construction of super high-rise buildings above 500 meters and strictly prohibit the construction of “ugly buildings”.
In 2020, the two ministries also mentioned: to strictly limit the construction of new buildings over 250 meters in accordance with the “Fire Prevention Code for Building Design”.
Also recently, China’s Ministry of Housing and Construction issued a notice on strengthening green and low-carbon construction in county cities (draft for comment), also mentioned: new residential buildings in county cities are mainly 6-storey, and the proportion of 6-storey residential buildings and below should not be less than 75%. The maximum number of new residential buildings in the county shall not exceed 18 stories.
It can be seen that the future of China’s property market buildings to low-rise development.
Once upon a time, high-rise buildings were the dream of most people. Young people living in rural areas aspired to high-rise buildings in big cities, and people living in cities were keen to buy houses with high floors. Moreover, skyscrapers were seen as a sign of urban prosperity and modernization. Even the competitiveness of cities is compared to each other in terms of the number and height of skyscrapers.
In the last 20 years, a skyscraper has risen from the ground. The “first tallest building in China” and “the first tallest building in the city” have been refreshing the horizon.
According to the latest data published on the official website of World Tall Building and Urban Habitat Society: including the under-construction, completed and planned super-tall buildings, there are 464 super-tall buildings above 300 meters in China, and this figure is more than one-third of the world, among which Shenzhen, Guangzhou, Shanghai and other places are the most.
In addition, another data shows: China’s supertall buildings planned under construction and completed over 200 meters account for 45% of the world’s total, and 7 of the 18 supertall buildings planned under construction and completed over 600 meters in the world are in China.
It is generally considered that when a building exceeds 100 meters (about 40 stories), it is considered a supertall building.
Supertall buildings have certain economic and social significance at certain times, such as helping to attract investment and alleviate the problem of lack of urban space. However, as time goes by, the disadvantages become more and more obvious.
1、Seriously rotten phenomenon of super-high rise. Ultra-high buildings have high technical requirements, consume large amounts of money and have long construction cycles. Ultra-high buildings have special requirements in terms of structure, materials and equipment, elevator equipment, safety, etc., which cannot be completed by general developers, with construction cycles of up to several years, and in some cases up to ten years. In the last 20 years, the ultra-high floors because of the broken chain of funds and rotten from time to time appear in front of us.
2, the vacancy rate of super-high buildings is serious. 100 meters or more super-high buildings are mostly office buildings.
According to Savills: 16.6% vacancy rate of Grade A office buildings in Beijing in the first quarter of 2021, up 3.3 percentage points year-on-year. Colliers International data shows that the office vacancy rate in Shanghai in 2020 is 22.7%. In addition Shenzhen office vacancy rate is also relatively high, 25.54%.
- High cost of demolition of super tall buildings. Every building has a life span, at most not more than 80 years, and when it reaches the end of the year, it is demolished or renovated. However, it is almost impossible to demolish super-high buildings, unless the government funds. First, the cost of demolition is high and individuals and enterprises cannot afford it. Secondly, individuals and enterprises do not have enough motivation to demolish, if the developers have to increase the volume ratio and build higher floors to gain revenue, but this is not possible.
4, super high building risk hidden danger. Than fire prevention for example, now the fire rescue, firefighting equipment up to 17 floors, more than this floor can not help. And the floor is too high, the higher the elevator carrying capacity, maintenance costs and the frequency of failure is also high, prone to accidents.
Therefore, the future of the property market is the trend of low-floor.
But it must be understood that China’s property market has a serious “people and land mismatch”, that is, a small city with a small population base and constant population outflow has a large land area, but a large population base and constant population inflow of large cities with a tight land supply.
For example, Shenzhen, which has an actual population of over 20 million, has a land area of less than 1,000 square kilometers, which is smaller than many counties with a population of less than 500,000. Urban space is not enough to carry capacity, and land is tight. At this time, building high-rise becomes a choice of last resort.
Similar to Shenzhen, Xiamen, Zhengzhou and other cities with narrow land area and other first and second-tier cities, my judgment is that the trend is to limit the height of super high-rise office buildings, and it is difficult to see a skyscraper than a high phenomenon in the future.
For large cities, there are few high-rise residential buildings higher than 100 meters in major cities, due to limited land space, the future high-rise and high-density will continue for a long time (provided that it does not exceed 100 meters).
For such cities, there are two ways out in the future: 1. Strengthen satellite cities and lay out urban clusters. Vigorously improve the traffic, the small and medium-sized cities and surrounding counties and cities connected, people working in the central city can work in the surrounding residents, buy houses, and provide appropriate support measures (schools, hospitals, shopping centers, etc.) to reduce the pressure of housing in large cities. 2, urban area expansion, such as cities like Shenzhen, can be incorporated into the surrounding Dongguan, Huizhou, to solve the problem of lack of land space.
For the small county property market, low-rise has been inevitable. In the future, big cities may present more of a work attribute, while counties assume more of a leisure attribute. In other words, in the future, children may work and buy houses in big cities, while parents will retire in their own counties, when low floors meet this need and the trend of aging population.
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