First Financial reporter combed through the average unit price data of second-hand residences in February in various cities on China’s house price quotation platform and found that currently, the 10 cities with the lowest house prices are: Hegang, Shuangyashan, Shizuishan, Qitaihe, Zhangye, Bozhou, Tieling, Shuozhou, Liaoyuan and Baise.
Half of these 10 cities are located in the northeast, with the most in Heilongjiang, namely Hegang, Shuangyashan and Qitaihe. In addition, Jilin’s Liaoyuan and Liaoning’s Tieling are also in the top 10. In terms of type, these cities are mainly energy-based cities, especially with the coal industry. With the depletion of energy and population outflow, many cities are also facing a contraction situation.
Located in Heilongjiang’s Hegang and Shuangyashan, house prices are less than 3,000 yuan per square meter, and Qitaihe is only the first 3,000 yuan per square meter. Among them, Hegang unit price of 2101 yuan per square meter, the highest “cabbage price index”. In other words, to buy a set of 100 square meters of house, but also only need 200,000 yuan. In fact, the old neighborhood, especially the construction of relatively low standards of shanty houses, the price is even lower, a set of houses tens of thousands of yuan, the unit price of a few hundred yuan, such “cabbage price” house in the last two years has been widely concerned about public opinion.
Zhang Dawei, chief market analyst of Centaline Property, analyzed to First Financial, Hegang is a typical contraction city, the price of housing is so low, mainly because the resources are depleted, the industry itself is contracted, the population is in the outflow, so the house is also very cheap.
According to the statistical bulletin of Hegang City, in 2019, the city achieved a gross regional product (GDP) of 33.64 billion yuan. At the end of the year, the city’s total registered population was 985,000, including 802,000 in urban areas. Compared with 2013, the total population of Hegang decreased by 93,000 people or 8.6% in 6 years. In addition, the current urbanization rate of Hegang’s registered population is already as high as 81.4%, and according to international experience, there is less room for improvement.
On the one hand is the population outflow, urbanization rate is already high, on the other hand is a large number of shanty houses. Therefore, the overall demand for the Hegang property market is currently small, and the market size has shrunk sharply. According to the 2019 Hegang Statistical Bulletin, in 2019, all 42 real estate enterprises with development and operation activities in Hegang city, completed investment of 350 million yuan, down 52% compared with the previous year; housing construction area of 808,000 square meters, down 38% compared with the previous year; housing new construction area of 61,000 square meters, down 74%; commercial housing sales area of 35,000 square meters, down 70%, and commercial housing Sales amounted to 110 million yuan, down 66%.
Shuangyashan, also from Heilongjiang, also has an average unit price below 3,000 yuan, ranking the second lowest housing price city. The energy city of Shuangyashan is also facing a population exodus and urban contraction pattern. Data show that in 2019, the city’s birth rate in Shuangyashan was 4.03‰, the death rate was 4.91‰, and the natural population growth rate was -0.88‰. The total registered population at the end of the year was 1.407 million, down 0.1 million from the previous year.
The scale of real estate development in Shuangyashan shrank significantly in 2019. The annual real estate development investment of 660 million yuan was completed, down 61.7% from the previous year. The sales area of commercial properties was 266,000 square meters, down 44.7%, including 231,000 square meters of residential sales area, down 45.9%; sales of commercial properties were 690 million yuan, down 47.3%, including 570 million yuan of residential sales, down 48.4%.
Qitaihe is also a resource-depleted city. According to the 2019 statistical bulletin of Qitaihe City, the city’s industrial washed coal output above the scale in 2019 was 6.493 million tons, down 24.8% from the previous year; coke output was 5.643 million tons, up 35.3% from the previous year; electricity generation was 9.17 billion kilowatt hours, down 0.2% from the previous year; and furniture was 470,000 pieces, up 7.6% from the previous year. The city’s real estate development investment of 307 million yuan, a decline of 14.0% over the previous year. The sales area of commercial properties was 127,700 square meters, down 6.7% from the previous year.
Yi Baozhong, professor of Northeast Asia Research Institute of Jilin University, analyzed to First Financial, some resource-depleted cities in Northeast China have less new demand for real estate, mainly because of underdeveloped industries and large population outflow. From the supply level, such cities have more shanty houses and more supply. In addition, in the past planned economy era, enterprises ran society, many state-owned enterprises built houses for employees, and there are many non-commercialized houses, so the housing stock are a bit larger than other places.
Zhang Bo, the branch director of 58 Anju room property research institute, analyzed to the first financial, on the one hand, in recent years around the introduction of settlement policy to pull the crowd to settle, as the threshold for settlement around the continuous reduction, the proportion of population flow into the five major urban clusters continue to rise, the overall population of the northeast region showed a pattern of outflow than inflow, which to a certain extent weakened the degree of willingness of housing enterprises to invest. On the other hand, the population in the northeast region is also accelerating the concentration of large cities such as Shenyang, Dalian and Harbin, which has also led to an increase in the imbalance of real estate development in the region.
In addition to a few cities in the northeast, five other cities from five provinces in the central and western regions, three of which are from the great northwest, belong to cities with small total population and sufficient land supply. For example, Zhangye, with a total municipal area of more than 40,000 square kilometers, had a city resident population of only 1,237,600 at the end of 2019, which is equivalent to the size of a large population county in the Middle East.
Currently, Zhangye’s real estate investment growth is sluggish. Data released by the Zhangye Bureau of Statistics show that in 2020, the city’s real estate investment fell 34.21% year-on-year, a decline of 31.19 percentage points year-on-year. Among them, Ganzhou District real estate completed investment fell 34.28% year-on-year, a decline of 26.21 percentage points year-on-year expansion, accounting for 68.43% of the city’s real estate investment, is the main reason affecting the city’s real estate investment decline. Affected by the real estate market’s long depopulation cycle, excess supply and other objective factors, this trend will continue to exist this year.
The total resident population of Shizuishan is also only 800,000 people, and the current urbanization rate has exceeded 75%, so the space for urbanization growth has been relatively limited. As a resource-depleted city, the current real estate market in Shizuishan is saturated and has very limited room for growth, so the overall level of housing prices is relatively low.
It should be noted that the cities counted here include cities at the prefecture level and above, including municipalities directly under the central government, cities listed in the plan, provincial capital cities and ordinary prefecture-level cities, excluding county-level cities. Therefore, some county-level cities with lower house prices are not included in the statistics.
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