The Chinese mainland’s market for second-hand homes is slow. A netizen recently told of buying a house in Hangzhou, Zhejiang. Zhejiang province’s capital is one of China’s most expensive cities. After looking at more than 100 apartments in two months, he finally placed an order and signed a contract.
Some real estate agents sighed as it has become a common way to look at houses. Some customers have seen hundreds of suites without placing an order.”
Real estate agents are like “tour guides” because they almost have to know everything there is to know about second-hand real estate in the city and show clients around. A real estate agent said: “Now a buyer has at least fifteen brokers working for him.”
There is a saying that the mainland property market has a peak season of “Golden September and silver October.” During this time, household consumption increases significantly. But that stopped at the beginning of September this year.
Zhang Long is a senior broker at Hangzhou Lianjia. He told the Zhejiang “Qianjiang Evening News” that the second-hand market is slow right now, but there are a lot of listings, and the buyer’s order cycle is long.
The store’s agent usually takes customers to specific real estate and shows them all the homes for sale there. Zhang Long said,
“The market is so bad right now that it’s hard to make a deal, even if it is arranged in such a way.”
Huang Jianjun is the store manager of Deyou Real Estate Agency. According to his store’s statistics, home buyers now look at at least 300 listings online and more than 30 sets offline before placing an order.
“In the past, if you wanted to look at a house, you had to ask the landlord for a key. Now, most used houses and especially new houses are password-locked, which makes it easy to look at them. You can look at the house as long as the landlord gives you a temporary password. So on average when a normal customer comes to see the houses, If there are more than five homes, then he can see more than one in the same neighborhood.”
Huang Jianjun said that now if a broker wants to make a sale, he or she almost needs to be familiar with all the second-hand housing communities in Hangzhou.
One of his clients recently wanted to buy a house in the school district. At first, he preferred a particular school district, but the place was too old, so he shifted his view to another school district. Later, his friend took him to yet another school district.
Huang Jianjun said, “I can’t keep this client at all if I don’t know anything about other fields.”
“We once estimated that a person who wants to buy a house now has at least 15 brokers serving him.”
People are hesitant to buy because they don’t trust the real estate market. Even though the demand is strong, they are afraid that the price will go down after they buy, so they keep looking at houses to find one with a very high cost-to-performance ratio before they start.
China’s rise used to be shown by how quickly people built homes. Now, people have lost faith in that model. Buyers are pulling out, borrowers are not paying their mortgages, and developers are running out of money. Compared to July last year, the value of new home sales dropped by 29%. The most prominent developer in China, Country Garden, has said that its profits have dropped and that the market “has slid rapidly into deep depression.”