Since the end of September, it was reported that the Ministry of Natural Resources proposed to cancel the land price limit, many places have actively followed up, according to the middle index monitoring, 18 of the 22 cities have canceled the upper limit of land auction land price, in November, most cities carried out the cancellation of the upper limit of land price, the overall transaction premium rate increased to 72%，In some cities, such as Jinan, Hefei, Chengdu, Fuzhou, and Hangzhou, there are plots with high premium rates in the first auction, but the differentiation is still serious, and only high-quality plots are paid more attention to real estate companies.
For businessesAfter the land auction recovery price is high, the difficulty of land acquisition in core cities will increase, especially small and medium-sized real estate enterprises will face more fierce competition in land auctionsIn addition, due to the pressure of short-term market adjustment, real estate enterprises still need to remain rational in their investment and land acquisition, and it is still the most effective investment strategy for enterprises to invest regularly and maintain profits.
Policy changes: 18 cities have cancelled the upper limit of land auction prices;Ningbo raised the upper limit of the premium rate to 30%;Bei Shang Shen has not yet been adjusted
Table: Cancellation of land price cap and sales price limit in 22 cities
Data**: Comprehensive collation by the Middle Finger Research InstituteIn terms of land price capAccording to the monitoring of the middle index, since October, 22 cities have successively issued announcements on newly listed residential land19 cities optimize the upper limit of land priceAmong them, 18 cities have launched no maximum price limit for residential land (the upper limit of land price has been cancelled for some land plots in Tianjin), and the upper limit of the premium rate in Ningbo has been increased from 15% to 30%.WhileBeijing, Shanghai and Shenzhen still continue the previous land price restriction rules. Whether the upper limit of land prices will be lifted or not is closely related to the sentiment of the city's own land auction market. The sentiment of land auctions in Beijing and Shanghai is relatively stable, and many land parcels have reached the top, and it is unlikely that the upper limit of land prices will be lifted in the short term. For most cities, the land market has been sluggish since the beginning of this year, only a few plots have a high degree of attention, and the land price limit has not adapted to the current market situation, and many places have followed up to cancel the land price ceiling. At the same time,The land sale price limit policy has also been continuously optimized。According to the monitoring of the middle index, as of December 19, 3 cities including Nanjing, Chengdu and Fuzhou in 22 cities have clearly canceled the sales price limit, some areas of Hangzhou have canceled the price limit, and the sales limit price has not been clearly set in the 14 newly listed residential land documents in Hefei, Jinan, Qingdao and Tianjin, while Beijing, Shanghai and Zhengzhou still have sales restrictions. 
Soil auction performance: The popularity of high-quality land plots has risen, and the differentiation of land auctions has become more and more obvious
Table: Land transactions in 22 cities after the abolition of the upper limit on land prices (as of the end of November).
Data**: Comprehensive collation by the Middle Finger Research InstituteChart: Trend of monthly transaction premium rate of residential land in 22 cities
Data**:Middle finger data creis
After the abolition of the upper limit of land price, the auction of high-quality land plots has risen, driving the overall premium rate to increase. Compared with the market changes before and after the policy, from July to October before the policy adjustment, the transaction premium rate of residential land in 22 cities continued to decline, while in November after the price limit was cancelled in most cities, the transaction premium rate of residential land in 22 cities was 72%, an increase of 2 from the previous month8 percentage points, an increase of 08 percentage points, the overall is at a monthly high level in the past two years, ending a downward trend for six consecutive months. Overall, the land market after the abolition of the land price cap shows the following characteristics:First, the core plots of hot cities are heating up, driving the overall premium rate**, but the investment layout of real estate enterprises is still prudent, and the number of land kings is limited. Second, most of the high-premium land is obtained by central state-owned enterprises, and small and medium-sized real estate enterprises are under greater pressure to acquire land. Third, the differentiation of local auctions has been further intensified, the non-core plot has limited recovery. (1) Cities that have abolished the upper limit of land prices: Hangzhou, Jinan, Fuzhou, Hefei and Chengdu have fierce competition for core plots, and the highest premium rate of the auction is more than 30%, but the non-core areas are generally traded at the reserve priceTable: Land auctions in 22 cities where land price limits have been cancelled
Data**:Middle finger data creis
Jinan:On October 30, Jinan ushered in the first land auction after the cancellation of the upper limit of land price, with 12 cases launched, 2 unsold auctions, and 10 transactions, of which 4 were sold at a premium and 6 were sold at the reserve price. The land auction of the group plots west of Fenghuang North Road and south of Shangmao City Road is relatively hot, and after 241 rounds of bidding, it was paid a high premium of 53 by China Power Construction1% obtained;The ECS05-1 plot north of Tourism Road and west of Panlong Road has undergone 236 rounds of bidding, and is priced at a premium rate of 50 by Baosheng2% won. Hefei:On October 12, Hefei issued a new policy for land auctions, in addition to canceling the upper limit of land prices, it also mentioned that the "five nos" conditions for participating real estate companies and the principle of bidding are not allowed to be jointly bid and cooperative development. Therefore, in the land transfer on November 2, the number of real estate companies participating in the auction decreased significantly compared with the past, but the popularity was acceptable, with all 5 parcels of land sold, 4 premiums, and 1 reserve price. among othersPlots of BK202305 in Binhu District and BH202310 in Baohe District have attracted more than 10 real estate companies to participate in the auction, which are respectively at a premium rate by Anhui Expressway and Anhui Land. 0% Transaction. On November 20, Hefei sold 3 parcels of land, all of which were traded at a premiumThe premium rate of JK202306 in the Economic Development Zone and YH202310 in Yaohai District is more than 15%. Chengdu:On November 15, Chengdu canceled the land price limit for the first time after the auction, and the enterprises participated in the auction more actively, with more than 20 companies signing up for session 1 and more than 10 companies signing up for session 2. 7 parcels of land were all sold, 4 were sold at the reserve price, and 3 were at a premium, of whichThere are 2 parcels of land with a premium rate of more than 15%, located in Wannianchang in Chenghua District and Guanghua outside Qingyang District, which were won by Yuexiu and China Resources at a premium rate of % respectively. On November 30, the premium rate of 44 acres of land in Luhu, Tianfu New District, reached 61%. In the two land auctions held in December, there were still some plots with a premium rate of more than 30%. Fuzhou:On November 18, Fuzhou launched 14 cases, 11 transactions, 1 unsuccessful auction, and 3 canceled sales. The auction attracted real estate companies such as Poly, C&D, International Trade, Hubei Junda, Greentown, Shouzheng Investment, Shoukai, and China Wuyi. In the transaction of the lot,The premium rate of 4 cases exceeded 20%, of which 75 rounds of bidding for the No. 41 Pingxi plot were finally obtained by C&D with a high premium rate of 41%. In the land auction on November 28, the 2023-54 plot project is strategically located and the competition of real estate companies is high, and after 82 rounds of bidding, it was won by Fuzhou Zhongyi Real Estate, and the rest of the plots were sold at the reserve price. Hangzhou:On December 12, Hangzhou land auction for the first time implemented free bidding, except for the early termination of the transfer of the LA0611-02 plot in the key area of Binhu New Town, Lin'an District, for some reason, the remaining 9 were all sold, 5 were premium, 4 were the reserve price, and the transaction premium rate of the [2023] No. 165 plot of Hangzhou Zhengchu was as high as 383%, a total of about 133900 million, of whichGreentown74.100 million to get 4 cases. In addition, in addition to the above-mentioned cities,Nanjing, Qingdao, Wuhan, Chongqing, Zhengzhou, XiamenIn November, land auctions were also held after the upper limit of land prices was lifted, but the general reserve price was sold, and the sentiment of land auctions has not yet improved. On the whole, the cancellation of price limits has led to the heating up of land auctions for high-quality land plots in a small number of core cities, but the differentiation is still there, and non-core land plots are traded at multiple reserve prices. (2) Cities that have not lifted the upper limit of land prices: Beijing and Shanghai have performed relatively stable land auctions, and real estate companies with high-quality land plots are highly motivatedTable: Land auctions in 22 cities that have not lifted the land price limit this year
Table: Plots to be auctioned in Beijing in December 2023
Data**:Middle finger data creis
Since the beginning of this year,Beijing, Shanghai, ShenzhenThe sentiment of land auctions has stabilized, with the upper limit of land prices in Shanghai and Shenzhen accounting for more than 50%, and Beijing also accounting for more than 40%. Judging from the recent local auctions, December 4-5,ShanghaiLaunched 9 parcels of land, all of which were transacted, of which 3 reached the top, 5 were at the reserve price, and high-quality land plots still attracted high attention, and on December 15, Shanghai launched 4 parcels of land, all of which were transacted, of which 1 reached the top and 2 at the reserve price;Beijing5 parcels of land were sold, but the properties of the plots were average, and most of them were sold at the reserve price, and in late December, the land to be auctioned in BeijingThe Dahongmen plot is expected to still attract a high degree of attention, and it is reported that more than 10 companies have paid pre-application deposits. ShenzhenThere have been no local auctions in the past two months. On the whole, the performance of land auctions in Beijing and Shanghai is relatively stable, and the willingness of real estate companies to participate is high. At the same time, considering that Beijing and Shanghai vigorously optimized the regulation and control policies on December 14, it is expected that market sales will recover significantly, which may drive real estate companies to increase investment to a certain extent, and the heat of the local auction market is expected to continue next year. On December 19, the Beijing Municipal Planning and Self-Commission issued the Notice on Clarifying Matters Related to Land Prices Related to Commercial Residential Land Projects, which mentions ".For residential and public construction plots, the starting price of residential and public buildings, as well as the final transaction price of each of them, will be specified at the time of land transfer", making the land auction and land price more clear. 
Supply characteristics: From January to November, the transaction scale of high-premium land plots in the city increased year-on-year, and the increase in improved real estate in the future may form a certain support for the new housing market
Chart: Comparison of the transaction scale of high-premium residential land in 22 cities from January to November 2022 to 2023 (at the municipal level).
Note: The statistical caliber of high-premium rate plots is based on the transaction premium rate higher than 10%, and the upper limit of the premium rate of some plots in Wuhan, Jinan, Hangzhou, and Shanghai is less than 10%, if the transaction reaches the top, it will also be counted. Data**:Middle finger data creisIn the current market environment, most of the plots that can cause real estate companies to actively bid and trade at high premiums are high-quality plots in core areasAccording to the monitoring of the China Index, from January to November 2023, there were 293 transactions of high-premium land plots in 22 cities, an increase of 44 over the same period last year, and the transaction scale was 25.38 million square meters, a year-on-year increase of 187%, in November, the transaction scale of high-premium land in 22 cities was 1.35 million square meters, a year-on-year increase of 158%. In terms of specific cities, under the influence of the low base of Tianjin, Jinan, Guangzhou, Suzhou, Xiamen and Fuzhou, the transaction scale of high-premium land plots increased by more than 100% year-on-yearChengdu has increased the supply of land in the core area this year, and the transaction area of high-premium land plots has also increased by more than 100% year-on-yearThe performance of local auctions in Beijing, Shanghai and Hangzhou was stable, showing varying degrees of growth. After the upper limit of land price was lifted, the transaction floor price of some land plots hit a new high. Such as:Hangzhou:Xingyao 38The railway north plot obtained at a premium rate of 3% set a new record for the floor price of the plate;Chengdu:Bangtai 33The land plot No. 348 Shuanglin Road, which was obtained at a premium rate of 5%, was sold at a floor price of 21,100 yuan, breaking through the highest floor price in Chenghua District. Fuzhou:The old and renovated plot of No. 2023-41 Pingxi Community, which was acquired by C&D with a premium rate of 41%, reached a transaction floor price of 28,677 yuan, setting a new high in the land price of the plate. If the high-quality land plots transacted in 2023 gradually enter the market next year, it is expected to provide some support for new home sales in some cities. In addition, from the perspective of high-premium land acquisition enterprises, the central state-owned enterprises are the absolute main force, and some private enterprises in the land plots are active. According to the data of the China Index, since the abolition of the upper limit of land prices, as of December 19, the amount of land acquired by central state-owned enterprises accounted for 630%, private enterprises accounted for 291%, mixed ownership enterprises accounted for 79%。
Outlook on land market trendsJudging from the performance of local auctions,Since the beginning of this year, in the context of the sales side has not yet warmed, the first push land, real estate companies are still cautious, and many cities have recently canceled the upper limit of the price limitOnly a small number of high-quality land plots in core cities have heated up, the phenomenon of differentiation is further intensified. Looking ahead to next yearIn cities where the upper limit of land prices has been abolished, it is expected that some core plots will be auctioned at high premiums under the focus of real estate investment, but the differentiation of land auctions will continue, and there will still be transactions at reserve prices or even unsold in non-core areasBeijing, Shanghai and Shenzhen are expected to optimize the rules of land auctions according to market changes, such as canceling or raising the upper limit of premium rates in some areas. In addition, the amount of land will continue to shrink in 2023, but the transaction scale of high-quality land plots will increase compared with the same period last year, and it is expected that the entry of these projects into the market will support new home sales. From the perspective of corporate competition and investment strategyAfter the abolition of the upper limit on land prices, in order to obtain high-quality land plots in core cities, real estate enterprises should optimize their land acquisition strategies and investment standards in a timely manner to cope with a more complex competitive environment. Due to the relatively good financial strength of central state-owned enterprises, the proportion of subsequent land acquisition may continue to increase, while for small and medium-sized real estate enterprises, the pressure on land acquisition in core cities has increased. At the same time, it is worth noting that with the more fierce competition for some plots, if enterprises acquire land at a high premium, it will lead to the compression of project profits.