In recent times, there has been a phenomenon in various parts of mainland China where local state-owned platforms are selling off properties in bulk. Property ownership transfer centers in Beijing, Guangzhou, Shandong, and other places have successively posted information on the transfer of hundreds of properties. The real estate market has swiftly shifted from the previous stage of “asset appreciation” to “maintaining value and exiting,” revealing the financial strain behind local state assets.
This recent surge of state-owned property sales in many regions has garnered attention from the public.
In Sichuan, the Real Estate Affairs Center in Xichang recently commissioned Sichuan Public Trust Auction Co., Ltd. to conduct an online public auction of 144 units of “affordable housing.” Official information indicates that these properties are priced “reasonably, slightly below market rates,” available for physical viewings, and support “75% bank mortgage loans.”
In Fujian, on November 5th, the Fuzhou Public Resource Trading website announced that Chaole District Leading Land and Housing Development Co., Ltd. will hold a public auction on November 21st for 51 units of commercial properties, with prices ranging from 447,000 to 1,536,000 yuan, averaging at 11,041 yuan/square meter.
Earlier, the Fuzhou Land Development Center also announced the proposed transfer of its 302 residential units, all of which are vacant properties with property rights certificates already issued, averaging about 20,078 yuan/square meter.
In Beijing, information from the Beijing Property Exchange indicated that the Tianheng Group under the State-owned Assets Supervision Commission of Xicheng District recently listed 111 properties for sale, located in Xicheng, Haidian, Chaoyang, Fangshan districts, with base prices ranging from 1.06 million to 13.97 million yuan, totaling over 330 million yuan.
Moreover, in locations like Guangzhou, Yantai, and Zibo, state-owned platforms have also been seen carrying out large-scale listings for the sale of properties, commercial premises, and parking spaces involving companies like the Guangzhou Airport Construction Investment Group and the Guangzhou Metro Group.
Why are state-owned assets clustering to “sell houses”?
Li Yujia, Chief Researcher of the Guangdong Housing Policy Research Center, analyzed that delays in the distribution of some affordable housing or sales-oriented subsidized housing have led to state-owned development enterprises having their funds tied up for long periods. To alleviate financial pressure, local state-owned assets are inclined to recover cash flow through public auctions.
He pointed out that in the current market downturn, state-owned assets holding long-term low-yield rental housing, while having high management costs, further drives the acceleration of their disposal of existing assets.
Bai Wenxi, Vice Chairman of the China Enterprise Capital Alliance, also stated that the concentrated “selling of houses” by state-owned assets is mainly to reduce liquidity pressure. The downturn in the real estate market, tight local finances, and the added burden of local government financing platforms “debt restructuring” have led to a sudden increase in short-term debt repayment pressure. “Selling existing properties can quickly recoup funds to repay maturing debt or ensure expenditure for infrastructure and people’s livelihood projects.”
An article in “Beifeng Chuang” pointed out that currently, “the most aggressive sellers are not developers, but local state-owned enterprises and urban investment companies. They are not selling self-built properties but rather batches of properties they hold—clearance-style selling not for profit margins, but for self-rescue.”