Recently, Huangpu District in Guangzhou launched a new resettlement plan, applying the housing ticket mechanism originally used for urban village renovation for the first time to settle unfinished property owners.
At the beginning of December, news from Huangpu District in Guangzhou showed that the first nationwide housing payment voucher, known as “Guaranteed Property Exchange Voucher” (referred to as “housing ticket”), issued by the district was exchanged and signed on October 24th.
According to the report by China Real Estate News, Ms. Su, a homeowner of Shenglong Xuefu Shangcheng, was the user of this housing ticket. She mentioned that the property she purchased was originally scheduled for delivery in June 2024, which is now more than a year past due.
As reported by China News Weekly on December 13th, the homeowner of Shenglong Xuefu Shangcheng was the first user of the guaranteed property exchange voucher, with a face value of 3.04 million yuan. The homeowner eventually exchanged it for a new residential property of about 113 square meters in the “housing source supermarket” led by a state-owned enterprise in Huangpu District.
The properties eligible for housing ticket exchange are the stalled residential projects of Shenglong Xuefu Shangcheng and Shidi Changchun Teng in Huangpu District, Guangzhou.
Shidi Changchun Teng is also a large residential project with a total construction area of 2 million square meters, developed in multiple phases. The developer Shidi Group faced cash flow constraints in 2021, resulting in delays in delivering some properties to homeowners. It is reported that five of the project’s phases, including buildings five and six, are still under construction.
According to sources, Huangpu District has included around 200 homeowners of Shenglong Xuefu Shangcheng and Shidi Changchun Teng in the housing ticket resettlement scope. Homeowners can use the ticket to purchase existing properties in the “housing source supermarket” based on the principle of “equivalent substitution.”
In recent times, due to a decline in new home sales and developers facing financial constraints, some projects have had difficulties in delivery. Li Yujia, the director of the Housing Policy Research Center of Guangdong Urban Planning Institute, believes that for unfinished property owners, emotional reassurance comes first. The guaranteed property exchange voucher to some extent reduces the homeowners’ worries about delivery. Moreover, for homeowners, rather than waiting for unfinished properties for a long time, accepting the housing ticket to quickly purchase a house, sign the agreement, and move in may be a better option.
However, industry insiders also caution that the premise of the housing ticket mechanism lies in whether the subsequent payment can be smoothly completed. Yan Yuejin, deputy director of the E-House Research Institute, pointed out that as long as the financial pressure on unfinished enterprises remains substantial, there is uncertainty in the payment of housing tickets.
Several researchers emphasize that the root of the unfinished property problem lies in developers and their actual controllers’ illegal diversion of funds. If effective accountability measures cannot be implemented to compel them to dispose of assets, a single resettlement tool may not fundamentally mitigate delivery risks.
Li Yujia also stated that the process of reviving assets of unfinished properties and recovering funds can vary in length, and the amount of funds that can be recovered is also uncertain.
Li Yujia stressed the importance of consolidating the main responsibilities of real estate companies to guarantee property exchange, the main responsibilities of local governments, as well as enforcing full accountability of developers and their actual controllers for unfinished properties. This should pressure them to sell assets to ensure delivery, instead of evading their responsibilities.
According to the China Real Estate News report, some homeowners of Shenglong Xuefu Shangcheng have chosen not to opt for housing ticket resettlement, hoping that the developer will continue to fulfill the contract and deliver the houses.