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URBAN VIEW -1-
Contents:
2015 Issue No. 6
02 Data & Views Macro Economy
Urban Data - Shanghai Inventory
Residential Price Index
Urban Analysis - Real Estate Market
Costs of Building Materials &
Construction
23 Industry Focus Is 90/70 Policy about to End?
27 In-Depth Observation To Promote the Informatization of
Appraisal Industry, a Unified Data
Standard Shall be in Place First
36 News Guidance Policy & Regulation
Real Estate Finance
Market Highlights
Hosted by: Urban Surveyors -
Shanghai Urban Real Estate
Appraisal Co., Ltd. (SUREA)
Chief Editors: Yuan Donghua, Xu
Jun
Deputy Editors-in-Chief: He Jian,
Ren Tingzhen
Executive Editor: Qin Yun
Associate Editors: Shao Minghao,
Huang Haisheng, Jiang Qimin, Lin
Feng
Editors: Lin Jingjun, Ren
Chenying, Shi Jian, Mi Huiying
Art Editor: Zhang Tao
Address: 15-18F New Golden
Bridge Plaza, No. 1 West Beijing
Road, Shanghai
Postcode: 200003
Website: www.surea.com
Email: [email protected]
Tel: 86 21 63589988
URBAN VIEW -2-
Data & Views
Shanghai Inventory Residential Price Index rose by 1.51%
Business-oriented land market: transaction volume declined due to
low supply
Commodity residential market: “slack season” was not slack
Pre-owned residential market: supply was likely to fall short of
demand
VISS base price reached RMB 31,431/sqm in July
URBAN VIEW -3-
Macro Economy
Trend of CPI & PPI, Jan 2013 ~ July 2015
Growth of Shanghai Real Estate Loans, Jan 2013 ~ June 2015
CPI (July)
Category YoY % MoM %
CPI 1.6 0.3
Food 2.7 0.7
Tobacco, liquor and articles 3.6 0.1
Clothing 2.9 -0.5
Household appliances and
maintenance services
1.0 0.0
Health care and personal
articles
1.9 0.1
Transportation and
communication
-1.8 0.0
Recreation, education,
culture articles and services
1.7 0.8
Residence 0.8 0.1
PPI (July)
Category YoY % MoM %
PPI -5.4 -0.7
Means of production -6.9 -0.9
Mining industry -19.4 -1.5
Material industry -9.7 -1.2
Process industry -4.5 -0.7
Means of livelihood -0.3 0.0
Food 0.2 0.1
Clothing 0.5 0.0
Articles for daily use -1.0 -0.2
Durable consumer goods -0.7 -0.2
-6.00%
-5.00%
-4.00%
-3.00%
-2.00%
-1.00%
0.00%
1.00%
2.00%
3.00%
4.00%13
-1
13-2
13-3
13-4
13-5
13-6
13-7
13-8
13-9
13-1
0
13-1
1
13-1
2
14-1
14-2
14-3
14-4
14-5
14-6
14-7
14-8
14-9
14-1
0
14-1
1
14-1
2
15-1
15-2
15-3
15-4
15-5
15-6
15-7
CPI PPI
-100
-50
0
50
100
150
13-1
13-2
13-3
13-4
13-5
13-6
13-7
13-8
13-9
13-1
013
-11
13-1
214
-114
-214
-314
-414
-514
-614
-714
-814
-914
-10
14-1
114
-12
15-1
15-2
15-3
15-4
15-5
15-6
RMBmillion
Growth of real estate development loansGrowth of personal housing loans
x 10
0
URBAN VIEW -4-
Urban Data
- Shanghai Inventory Residential Price Index 1. The city index rose by 1.51%. The increase was expanding.
The Implementation Opinions on Deepening the Institutional Mechanism Reform of
Human Resources Work to Encourage Innovation and Entrepreneurship published on
July 5 will not bring significant impact on Shanghai’s real estate market in the near
term. It will slowly drive the home purchasing demand in Shanghai in the long term.
Shanghai Inventory Residential Price Index reached 169.79 in July 2015, a MoM growth of 1.51% and a YoY rise of 4.69%.
The city’s index increase over the past three months
Month Index MoM Increase
2015. 5 164.85 1.70%
2015. 6 167.26 1.46%
2015. 7 169.79 1.51%
URBAN VIEW -5-
2. Index increase within the Inner Ring Road continued soaring. Move-up
demand remained the pillar.
The index increase
within the Inner Ring
Road was 2.08%, the
highest in this month;
the index increase
beyond the Suburban
Ring Road was 0.75%,
the lowest in this
month.
3. 27 sections saw increases over 2%. Jinqiao saw a slight drop in this month.
In July 2015, most of the sections saw increases in price index, among which 27
sections saw growth over 2%. Jinqiao section saw a slight drop of 0.19% in this
month.
Between OR and SR167.99 1.52%
Within IR 173.51 2.08%
Between IR and MR 179.45 1.66%
Between MR and OR 175.31 1.36%
Outside SR 141.08 0.75%
URBAN VIEW -6-
Urban Analysis——Land Market 1. Supply
1) Overall Supply
The overall supply of business-oriented land in July stayed at low level. Totally 51.4
hectares of land were supplied. Only 3 parcels of industrial land were supplied,
totaling 4.1 hectares, a monthly new low.
2) Supply of Business-oriented Land by Type
In terms of the supply of business-oriented land, 28.8 hectares of affordable housing
land, 14.8 hectares of retail/office land and 7.7 hectares of mixed-use land (incl.
residential use) were supplied in July; no commodity residential land was listed in this
month.
0
100
200
300
400
500
600
14-07 14-08 14-09 14-10 14-11 14-12 15-01 15-02 15-03 15-04 15-05 15-06 15-07ha.
Trend of Land Supply
Business-oriented land Industrial land
0
20
40
60
80
100
120
140
160
14-07 14-08 14-09 14-10 14-11 14-12 15-01 15-02 15-03 15-04 15-05 15-06 15-07ha.
Supply of Business-oriented Land by Type
Commodity residential land Retail/office land
Affordable housing land Mixed-use land (incl. residential use)
URBAN VIEW -7-
2. Transaction Volume
1) Overall Transaction Volume
Land transaction greatly fell due to low supply. In July, 54.9 hectares of
business-oriented land were transacted, a MoM decrease of 23.9%. Only 4.1 hectares
of industrial land were transacted, a MoM decline of 66%.
2) Transaction Volume of Business-oriented Land by Type
Among all types of business-oriented land, affordable housing land remained No. 1 in
terms of transaction volume, with 28.8 hectares transacted. The transaction volume of
retail/commercial land saw drastic rebound, with 18.3 hectares transacted. 7.7
hectares of mixed-use land (incl. residential use) were transacted. There was no
commodity residential land transacted.
0
100
200
300
400
500
600
14-07 14-08 14-09 14-10 14-11 14-12 15-01 15-02 15-03 15-04 15-05 15-06 15-07ha.
Trend of Land Transaction Volume
Business-oriented land Industrial land
0
20
40
60
80
100
120
140
160
180
14-07 14-08 14-09 14-10 14-11 14-12 15-01 15-02 15-03 15-04 15-05 15-06 15-07ha.
Transaction Volume of Business-oriented Land by Type
Commodity residential land Retail/office land
Affordable housing land Mixed-use land (incl. residential use)
URBAN VIEW -8-
3. Transaction Price
Although the land transaction was dominated by affordable land and there was no
commodity residential land transacted in July, supported by the transactions of
retail/office land and mixed-use land (incl. residential use), average transaction price
of business-oriented land did not decreased greatly and only fell to RMB 30,942/sqm.
The average transaction price of mixed-use land (incl. residential use) jumped to
RMB 114,036/sqm. The average transaction price of retail/office land increased to
RMB 40,464/sqm.
0
20000
40000
60000
80000
100000
120000
14-07 14-08 14-09 14-10 14-11 14-12 15-01 15-02 15-03 15-04 15-05 15-06 15-07RMB/sqm
Average Transaction Price of Business-oriented Land
Business-oriented land Commodity residential land
Retail/office land Mixed-use land (incl. residential use)
0
1000
2000
3000
4000
5000
6000
7000
8000
9000
14-07 14-08 14-09 14-10 14-11 14-12 15-01 15-02 15-03 15-04 15-05 15-06 15-07RMB/sqm
Average Transaction Price of Industrial Land
Industrial land
URBAN VIEW -9-
Urban Analysis——New Residential Market 1. Supply and Demand, Transaction Volume and Price
In July 2015, the city’s new commodity residential supply totaled 963,400 sqm, a
MoM increase of 22.51% and a YoY growth of 11.00%; the transaction area totaled
1,346,800 sqm, a MoM decrease of 9.54% and a YoY rise of 96.47%. The
supply-to-demand ratio was 0.72, still below 1. The problem of short supply
remained. The transaction prices averaged RMB 34,682/sqm in July, slightly
increasing MoM by 1.44% and soaring YoY by 30.81%.
0
20
40
60
80
100
120
140
160
14-7 14-8 14-9 14-10 14-11 14-12 15-1 15-2 15-3 15-4 15-5 15-6 15-7
sqmMonthly Supply & Demand for Commodity Housing
Supply area Transaction area
x 10
000
-10
-5
0
5
10
15
20
25
30
35
20,000
22,000
24,000
26,000
28,000
30,000
32,000
34,000
36,000
14-7 14-8 14-9 14-10 14-11 14-12 15-1 15-2 15-3 15-4 15-5 15-6 15-7
%RMB/sqm Average Transaction Price of Commodity Housing
MoM YoY Average transaction price
URBAN VIEW -10-
2. Hot Sections
Top 10 sections in terms of commodity residential transaction volume across the city in July 2015
Rank Section Supply Area
(sqm)
Transaction
Area
(sqm)
Average Transaction
Price
(RMB/sqm)
Turnover
(RMB
Billion)
1 Jiading New Town 85,423 72,028 20,337 1.465 2 Songjiang New Town - 64,858 22,212 1.441 3 Huamu & Beicai 72,023 60,092 49,126 2.952 4 Zhoukang - 56,625 29,289 1.659 5 Gaoqiao & Gaohang 31,121 53,523 35,665 1.909 6 Pujiang Town 30,630 46,994 38,389 1.804 7 Nanqiao - 42,788 23,851 1.021 8 Xujing 36,524 39,994 35,387 1.415 9 Huinan 21,462 39,787 18,971 0.755
10 Qilian - 38,235 28,032 1.072
Top 10 projects in terms of commodity residential transaction volume across the city in July 2015
Rank Project Name District Section
Transaction
Area
(sqm)
Average
Transaction
Price
(RMB/sqm)
1 Lujiazui Jin Xiu Li Pudong Huamu & Beicai 30,481 38,113 2 Waigaoqiao Sunland Residence Pudong Gaoqiao & Gaohang 26,775 35,653 3 Baohua Original Villa Minhang Pujiang Town 19,612 43,802 4 Wenxi Residence Zhabei Pengpu & Yonghe 16,238 41,353 5 City Oasis Baoshan Qilian 16,175 24,105 6 Jin Mao Palace Zhabei Daning 16,165 75,446 7 Pudong Yi Jing Yuan Nanhui Huinan 14,575 22,682 8 The Future of Life Qingpu Qingpu 14,411 20,940 9 Sheng Shi Bao Di Baoshan Songnan 13,661 30,382
10 SRE Yabinli Garden Zhabei Everbright City 13,619 61,997
URBAN VIEW -11-
3. Hot New Supply
Top 10 projects in terms of new commodity residential supply across the city in July 2015
Rank Project Name District Section New Supply Area
(sqm)
1 Wonderful City Jiading Jiading New Town 43,375 2 The Future of Life Qingpu Qingpu Town 40,449 3 Li Du Garden Nanhui Lingang New Town 39,160 4 Season Residence Jiading Nanxiang 37,549 5 Wonderful World Town Pudong Huamu & Beicai 37,320 6 Long Ting Minhang Greater Gumei & Meilong 37,162 7 Zhengro Mansion Qingpu Xujing 36,524 8 Ideal of Life Nanhui Xinchang 36,120 9 Shinning Bay Qingpu Huaxin Town 35,969
10 Firenze Park Pudong Yuanshen Yangjing 35,825
4. Transaction Structure
below 1m4%
100~15010%
150~20013%
200~30023%
300~40016%
400~50010%
above 5m24%
Transaction Structure of Commodity Housing by Total Price, July 2015
below 703%
70-9022%
90-14552%
145-20013%
200-3008%
above 3002%
Transaction Structure of Commodity Housing by Area, July 2015
below 1m6% 100~150
11%
150~20013%
200~30025%
300~40013%
400~5008%
above 5m24%
Transaction Structure of Commodity Housing by Total Price, June 2015
below 704%
70-9022%
90-14550%
145-20013%
200-3009%
above 3002%
Transaction Structure of Commodity Housing by Area, June 2015
m = million
URBAN VIEW -12-
By area, the proportion of properties with an area of 90-145 sqm increased by 2.36
percentage points while the proportions of properties with an area below 70 sqm and
an area of 200-300 sqm decreased by 1.12 percentage points and 1.28 percentage
points, respectively.
By total price, the proportions of properties priced below RMB 3 million increased
across the board. The proportions of properties priced RMB 3-5 million fell by 4.89
percentage points.
5. Inventory Change
As of end-July 2015, the city’s first-hand residential inventories totaled 82,830 units,
a slight increase of 67 units compared with last month.
30000
40000
50000
60000
70000
80000
90000
100000
Jul Nov Mar Jul Nov Mar July
UnitsChange of Shanghai Residential Inventory, July 2013～July 2015
URBAN VIEW -13-
Urban Analysis——Second-hand Residential Market 1. Transaction Volume and Price
In July, the city’s second-hand residential transaction volume totaled 31,835 units,
dropping by 5.06% MoM and soaring by 182.63% YoY; the average price signed on the
Internet was RMB 24,887/sqm, up by 0.65% MoM and 21.65% YoY.
2. Transaction Volume by District
By district, among the 19 districts in Shanghai, only 3 districts seeing MoM increase in
transaction volume, namely, Chongming, Baoshan and Fengxian, all of which were
suburban districts. There were 16 districts seeing decrease in transaction volume, 1 more
than the number in last month. The decreases ranged from 0.44% to 22.5%. Central
districts, such as Huangpu, Luwan, Xuhui, Jing’an, saw comparatively larger decrease.
15,000
18,000
21,000
24,000
27,000
30,000
0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
14-7 14-8 14-9 14-10 14-11 14-12 15-1 15-2 15-3 15-4 15-5 15-6 15-7 RMB/m2
Transaction Volume and Price of Second-hand Housing
Transaction volume (unit) Average transaction price (RMB/㎡)
Units
-25.00%
-20.00%
-15.00%
-10.00%
-5.00%
0.00%
5.00%
10.00%
0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
Baoshan
Changning
Chongming
Fengxian
Hongkou
Huangpu
Jing'an
Jiading
Jinshan
Luwan
Minhang
Nanhui
Pudong
Putuo
Qingpu
Songjiang
Xuhui
Yangpu
Zhabei
UnitsTransaction Volume of Second-hand Residential Housing by District, June vs July 2015
June July MoM
Average MoM
Growth
URBAN VIEW -14-
3. Hot Sections
Top 10 sections in terms of MoM increase in secondhand residential transaction volume in July 2015
Rank District Section No. of Units
Transacted MoM YoY
1 Chongming Chongming 199 30.92% 30.07% 2 Fengxian Haiwan 110 22.22% 96.43% 3 Baoshan Yuepu 295 18.00% 180.95% 4 Baoshan Yanghang 383 16.77% 303.16% 5 Jiading Nanxiang 209 15.47% 354.35% 6 Fengxian Fengcheng 63 14.55% 23.53% 7 Pudong Jinqiao 1138 11.57% 227.95% 8 Pudong Waigaoqiao 589 10.71% 342.86% 9 Baoshan Songnan Gaojing 505 10.02% 238.93%
10 Jinshan Fengjing 54 8.00% 58.82%
4. VISS Base Price
According to the statistics of VISS system,
in July 2015, the city’s mean of residential
quarters was RMB 30,789/sqm, up by
1.61% MoM and 5.02% YoY; the city’s
median of residential quarters was RMB
31,431/sqm, up by 1.39% MoM and 4.77% YoY.
From the view of regional base prices on a monthly basis, in July, all the districts saw
growth varying from 0.30% to 2.39%. The three-month overall increase showed that the
real estate market had fully rallied, and the market was expected to achieve a stable
performance while at the same time securing progress.
BS CN CM FX HK HP JA JD JS LW MH NH PD PT QP SJ XH YP ZB
June 2015 1.65% 1.47% 0.90% 0.28% 1.63% 1.58% 1.17% 1.51% 0.19% 1.45% 1.23% 1.26% 1.60% 1.89% 0.90% 1.02% 1.29% 1.92% 1.55%
July 2015 2.39% 1.69% 0.81% 0.98% 1.98% 1.67% 2.39% 1.15% 0.30% 0.90% 1.38% 1% 1.70% 1.50% 0.44% 1.16% 1.63% 2.01% 1.65%
0.00%
0.50%
1.00%
1.50%
2.00%
2.50%
3.00%MoM Change of Base Price by District, June 2015 vs July 2015
Mean Median
URBAN VIEW -15-
In this month, there were 3 districts seeing a MoM increase in base price over 2%,
namely, Baoshan, Jing’an and Yangpu.
By section, there were 119 sections seeing growth of base price, and only Waigaoqiao
and Haiwan sections suffered from decline, but the average decrease narrowed.
5. Transaction Structure
Top 5 sections in terms of increase Top 5 sections in terms of decrease
Songbao
Caojiadu
Tangqiao
Zhangmiao
New JiangwanTown
25,599 26,384 3.06%
45,179 46,557 3.05%
38,991 40,174 3.03%
27,770 28,586 2.94%
40,407 41,584 2.91%
Waigaoqiao
Haiwan
23,988 23,960 0.11%
8,997 8,988 0.09%
below 7041.34%
70-9023.45%
90-12019.10%
120-1509.90%
150-1802.93%
180-3002.85%
above 3000.44%
Transaction Structure Second-hand Housing by Area, July 2015
below 0.5m4.96% 0.5m~1m
14.06%
1m~1.6m27.78%
1.6m~2m13.81%
2m~3.3m24.45%
3.3m~5m8.73%
above 5m6.21%
Transaction Structure of Second-hand Housing by Total Price, July 2015
below 7041.37%
70-9022.61%
90-12019.56%
120-1509.98%
150-1802.96%
180-3003.02%
above 3000.50%
Transaction Structure Second-hand Housing by Area, June 2015
below 0.5m4.54% 0.5m~1m
14.28%
1m~1.6m27.55%
1.6m~2m13.61%
2m~3.3m24.39%
3.3m~5m9.33%
above 5m6.30%
Transaction Structure of Second-hand Housing by Total Price, June 2015
m = million
URBAN VIEW -16-
By total price, in July, the transaction proportions of second-hand properties priced below
RMB 2 million rose slightly while the transaction proportions of second-hand properties
priced 3.3-5 million dropped by 0.6 percentage points.
By area, only the proportion of properties with an area of 70-90 sqm expanded by 0.84
percentage points, hitting a new high for the year. The proportions of properties with
other areas declined to different extent. Based on these movements, we could know that
rigid demand recovered while move-up demand reduced on the second-hand residential
market in July.
URBAN VIEW -17-
Urban Analysis——Retail / Office Market 1. Supply
1) Monthly Retail / Office Supply
The new supply of retail properties totaled 308,000 sqm, staying at the high level. The
office supply rebounded to 546,000 sqm, a MoM surge of 69%.
2) Retail / Office Supply by District
In terms of the new supply in office sector, Minhang led the ranking of supply volume
with 179,000 sqm, accounting for more than 30% of the total. Jiading and Pudong were
the No.2 and No. 3, with 52,000 sqm and 50,000 sqm supplied, respectively. In retail
sector, Pudong won the No. 1 with 66,000 sqm listed, followed by Jinshan with 62,000
sqm supplied.
0
10
20
30
40
50
60
14-07 14-08 14-09 14-10 14-11 14-12 15-01 15-02 15-03 15-04 15-05 15-06 15-07sqm
Trend of Retail / Office Supply
Retail property Office property
x 10
000
0.0
2.0
4.0
6.0
8.0
10.0
12.0
14.0
16.0
18.0
20.0
Baoshan
Fengxian
Huangpu
Jiading
Jinshan
Minhang
Pudong
Qingpu
Songjiang
Xuhui
Yangpu
Zhabei
sqm
Retail / Office Supply by District, July 2015
Retail property Office property
x 10
000
URBAN VIEW -18-
2. Transaction Volume
1) Monthly Retail / Office Transaction Volume
In July, the office transaction volume jumped to 347,000 sqm, reaching a new high for
the recent 18 months. The retail transaction volume totaled 139,000 sqm. Despite of the
MoM decrease, it is still the second highest within the year.
2) Retail / Office Transaction Volume by District
By district, Pudong, Zhabei and Putuo were the top three in the office sector, with 72,400
sqm, 60,000 sqm and 44,000 sqm transacted, respectively. In the retail sector, Pudong
was also the No. 1, with 37,000 sqm transacted. Yangpu ranked No. 2, with 26,000 sqm
transacted.
0
5
10
15
20
25
30
35
40
14-07 14-08 14-09 14-10 14-11 14-12 15-01 15-02 15-03 15-04 15-05 15-06 15-07sqm
Trend of Retail / Office Transaction Volume
Retail property Office property
x 10
000
0.0
1.0
2.0
3.0
4.0
5.0
6.0
7.0
8.0
Baoshan
Changning
Chongming
Fengxian
Hongkou
Huangpu
Jiading
Jinshan
Luwan
Minhang
Pudong
Putuo
Qingpu
Songjiang
Xuhui
Yangpu
Zhabei
sqm
Retail / Office Transaction Volume by District, July 2015
Retail property Office property
x 10
000
URBAN VIEW -19-
3. Transaction Price
Compared with last month, the average transaction price of retail and office properties
basically kept flat in this month. The average price of retail properties was RMB
21,861/sqm, a MoM drop of 0.3%. The average price of office properties was RMB
26,288/sqm, a MoM increase of 1.1%.
4. Inventory Change
In July, the office inventories increased significantly to 8,850,000 sqm. The retail
inventories totaled 9,607,800 sqm and the supply-to-demand ratio reached 2.21.
0
5000
10000
15000
20000
25000
30000
35000
40000
14-07 14-08 14-09 14-10 14-11 14-12 15-01 15-02 15-03 15-04 15-05 15-06 15-07RMB/sqm
Trend of Average Transaction Price
Retail property Office property
400
500
600
700
800
900
1000
sqm
Monthly Change of Retail / Office Inventory
Retail property Office property
x 10
000
URBAN VIEW -20-
Cost of Construction Materials
Prices of steel, cement, yellow sand and commodity concrete in July 2015
No. Material name June 2015 July 2015 Increase or decrease
1 Wire price (Φ8mm) (RMB/ton) 2,391.67 2,292.00 -4.35%
2 HRB400 rebar (18mm) (RMB/ton) 2,229.33 2,091.75 -6.58%
3 HRB400 Rebar (25mm) (RMB/ton) 2,249.33 2,111.75 -6.52%
4 Ordinary Portland cement (strength grade
42.5) (RMB/ton) 286.67 280.00 -2.38%
5 Yellow Sand (medium-coarse)
(RMB/ton) 64.67 59.25 -9.14%
6 Pump Concrete C30 (particle size 5-25)
(RMB/m³) 347.33 343.00 -1.26%
URBAN VIEW -21-
Construction Cost Analysis Indicators
I Project Summary
Project name XX middle school building GFA 31,663 m2
Project location
Changning District – between
the Inner and Middle Ring
Roads
Height
20.8 m (the first floor is
4.2 m, the typical floor is
4 m
Structure type Frame structure Total
floors
5 floors aboveground and
1 floor basement
Function Teaching building Method of
charging
Charge by BOQ, prices
from 2012.05
II Construction Cost Indicators
No. Item Total cost (RMB) Index per sqm
(RMB/m2) Percentage
Cost for engineering
& installation 120,548,000.00 3,807.22 100.00%
I Engineering works 54,939,900.00 1,735.15 45.58%
1 Soil (Stone) works 3,251,000.00 102.68 2.70%
2 Piling & foundation
(incl. soil protection) 2,893,600.00 91.39 2.40%
3 Masonry 2,853,500.00 90.12 2.37%
4 Concrete and rebar
concrete 31,504,300.00 994.99 26.13%
5 Metal structure 563,200.00 17.79 0.47%
6 Roofing &
waterproofing 4,579,600.00 144.64 3.80%
7
Anti-corrosion,
insulation, thermal
insulation
9,294,700.00 293.55 7.71%
II Decoration works 32,681,200.00 1,032.16 27.11%
1 Ground & floor 6,490,300.00 204.98 5.38%
2 Doors and windows 4,050,300.00 127.92 3.36%
3 Cylinder & wall 13,892,100.00 438.75 11.52%
4 Ceiling 3,245,700.00 102.51 2.69%
5 Paints, coatings, wall
paper 2,475,500.00 78.18 2.05%
6 Other works 2,527,300.00 79.82 2.10%
III Installation works 14,705,900.00 464.45 12.20%
1 Electrical Engineering 9,432,400.00 297.90 7.82%
2 Water supply & 1,608,200.00 50.79 1.33%
URBAN VIEW -22-
drainage and gas
3 Firefighting works 2,566,600.00 81.06 2.13%
4 Ventilation and air
conditioning works 162,500.00 5.13 0.13%
5 Intelligence works 936,200.00 29.57 0.78%
IV Measure fees 17,200,200.00 543.23 14.27%
V Others (Maincon
service fee) 1,020,800.00 32.24 0.85%
Shanghai Urban Construction Cost Consulting Co. Ltd.
URBAN VIEW -23-
Industry Focus
Is “90/70” policy about to end?
“90/70” policy will impede the development of the market. The
decision-making power should come back to the market.
“90/70” policy once brought positive impacts but is no longer
suitable now.
Cancelling “90/70” policy can help de-stocking.
URBAN VIEW -24-
Is “90/70” policy about to end?
Although the real estate market of a few first and second-tier cities saw rebound, for
many local governments in where have inventories, their primary goal was still selling
the inventories and stabilizing the investment. In addition to relaxing the price limitation
and purchase limitation policies, another important regulating policy – mandatory
percentage requirement for the GFA per unit – was also gradually cancelled. According
to incomplete statistics, more than 10 provinces have promulgated policies to cancel the
“90/70” policy which has been implemented for about 10 years.
Meanwhile, at the end of March, the Ministry of Land and Resources and the Ministry
of Housing and Urban-Rural Development issued a notice firstly setting forth
“optimizing the unit size in housing supply. And allowing adjusting those unit sizes of
commodity housing not satisfying market demand based on the market conditions and
without changing the essential planning factors such as land usage, plot ratio to support
residents’ self-occupation demand and move-up demand.” The promulgation of this
notice made people think is it paving the way for the cancellation of “90/70”policy? In
this section, our discussion will revolve around the possible cancellation of “90/70”.
URBAN VIEW -25-
Urban View:
Shao Minghao
Project Director
Shanghai Urban Real Estate Appraisal Co., Ltd.
“90/70” policy started from May 2006, nine ministries including the former Ministry of
Construction set forth the “90/70” policy by issuing the Opinion on Restructuring
Housing Supply and Stabilizing Housing Price. It required that units smaller than 90
sqm should account for over 70% of a newly built residential project. The promulgation
of this policy brought significant impacts on the then-current real estate development,
especially on the residential real estate development. Some proposed luxury projects
with large units were forced to be changed to small-unit projects. This made the supply
number of home units see sharp increase within a certain period. The administration’s
objective of increasing the supply units of housing within a short time while not
increasing the land supply was achieved to some extent.
However, because this is a “one size fits all” policy, many regions failed to acclimatize.
For example, the home buyers in the north China prefer large-sized units so those
small-sized units have low marketability. Considering the various weaknesses of the
policy, developers took some measures. As a result, this policy existed in name only.
Therefore, the optimization of “90/70” policy in the recently-released Notice on
Optimizing the Structures of Housing and Land Supply in 2015 to Promote the Stable
and Sound Development of Real Estate Market was welcomed by market participants
and some local governments even took this opportunity to expressly cancel the “90/70”
policy.
The real estate market in 2006 was quite different from the market in 2015. The
difference lay not only in that the situation of commodity residential market shifted from
absolute shortage to relative surplus but also in that the commodity residential and
URBAN VIEW -26-
affordable residential market systems were separated from a former combination. The
commodity residential market is regulated by the market while the affordable residential
market is administrated by the government. Based on this difference, the “90/70” policy
should not be simply cancelled. It should exit from the commodity residential market
but should be strengthened on the affordable residential market. As the affordable
residential market is a more rigid market, which is closer to basic housing demand, it
needs “90/70” policy to guarantee the supply. However, the affordable housing supply in
many cities still suffers from the conflict between the overlarge size of units and the
deficiency in units. Therefore, the “90/70” policy should be carried out as a long-term
mechanism in the affordable housing sector.
URBAN VIEW -27-
In-Depth Observation
To promote the informatization of appraisal industry, a unified data
standard shall be in place first
The reasons of low informatization level in appraisal industry
Internal impetuses and external conditions to achieve a unified data
standard in appraisal industry
Main content of unified data standard
Prospects of unified data standard
URBAN VIEW -28-
To promote the informatization of appraisal industry, a unified
data standard shall be in place first
I. The reasons of low informatization level in appraisal industry
With the increasing impact of big data on real estate industry, the real estate appraisal
sector also started the work of informatization. However, many appraisal companies
have accumulated considerable number of data but cannot use them directly or reflect
their real value. The reasons include:
1. Lack of effective paths for data mining
Currently, the phenomenon of “abundant data, scare information” is very common.
The massive data which are growing rapidly are collected and stored in large
database. However, for lack of powerful analytic tools, a large part of the data is
buried in the “data tomb”.
2. Failure to achieve information sharing
Data sharing is the basic demand of informatization. In addition to the development of
hardware and software, the processing of data is also an essential part of
URBAN VIEW -29-
informatization. The unified data standard is just used to solve the problem of data
processing to achieve data sharing.
Since there is no unified data standard in the industry yet and the systems and
databases built by different appraisal companies are not compatible, the industry is
not able to achieve information sharing at present stage.
3. Low informatization level in the industry
The level of informatization is related to the future development of the whole
industry. In decades of years, the appraisal industry has gone through rapid
development and established a filing system for valuation repots, however, the
valuation process is still manual-operated. Now, although many appraisal companies
have begun to develop their own valuation system, these systems cannot be widely
transplanted and promoted for lack of a unified data standard. As a result, the
information level of the industry cannot be improved.
All these problems ultimately are the issue of data standard. Only on the basis of a
unified data standard can a trans-regional database be established. Only when the
database was established can the data be effectively stored. Only with an
accumulation of large volume of data can the effective information be well mined.
II. Internal impetuses and external conditions to achieve a unified
data standard in appraisal industry
Data are equally important from both practical perspective and management
perspective. To reasonably use and effectively mine data, a trans-industry and
trans-regional database and an informatization platform need to be built up. The first
thing to do is establishing a unified data standard.
Data standard is the foundation of informatization platform. The software developer
can use the unified data standard to develop the informatization systems of different
URBAN VIEW -30-
divisions for different purposes. Because the basis – the data standards – of these
systems is unified, these systems can achieve mutual docking and compatible
application in a comprehensive way, and finally achieve the goal of information
sharing. However, for now, there are 5 data standards under implementation
nationwide in the real estate industry, but actually only one of them deserve to be
called standard, that is, GB/T 19231-2003 Basic Terminology of Land. It may serve for
land science and land management rather than the foundation of informatization
platform.
In most areas of our country, housing ownership and land ownership are separately
administrated, which cause the failure to unify data standards and the inconsistency of
registration. The difference of data intension impedes the analysis of data in different
databases and thus the value of data cannot be achieved.
III. Main content of unified data standard
This unified data standard is formulated on the basis of the principles in GB/T
1.1-2009 Guidance of Standardization Part I: Structure of Standard and Its
Formulation.
1. Determination of scope
Our scope includes the classification method, coding system and the structuring of
data.
2. Data classification code
Based on the attributes and characteristics of the data, in this standard, we classify
data into five tiers through linear classification method. The tier code is composed of
two digits as follows:
URBAN VIEW -31-
Table 1 Data classification and coding system
×× ×× ×× ×× ×× First
classification Second
classification Third
classification Fourth
classification Fifth
classification
The code shall meet the requirements of table 2. The length shall be 10 digits, and 0
should be used if there is any absent at the end of the code.
Table 2 Classification and coding table
Code No. 1st classification 2nd classification 3rd
classification
4th
classification
5th
classification
010000000
0
Data of major
participants
010100000
0
Data of industry
association
010101000
0
Basic information
of industry
association
010102000
0
Basic information
of personnel of
industry association
010103000
0
Notification from
industry association
010200000
0
Data of appraisal
company
010201000
0
Basic information
of appraisal
company
010202000
0
Review record of
appraisal company
010300000
0 Data of appraiser
010301000
0
Basic information
of appraiser
010302000
0
Credit record of
appraiser
010303000
0
Continuing
education record of
appraiser
020000000 Business data
URBAN VIEW -32-
0
…… …… …… …… …… ……
050200000
0
Documents and
regulations
050201000
0
Policies, laws and
regulations
050202000
0 Document template
3. Data Structure Table
The table name of each category of data is the acronym of Chinese Pinyin in capital
form.
Table 1-1-1 Data structure of the basic information of industry association
No. Field Name Field
Code
Field
Type
Field
Length
Number of
decimal
places
Range Constraint
condition
1 ID of industry
association HYXHID Integer
>0 Mandatory
2 Industry type XHLX Short
A199 dictionary
table of association
type
3 NGO or not SFMJZZ Boolean
4
Registered
according to law
or not
SFYFDJ Boolean
5 Association
name
XHM
C String 50
Mandatory
6 Association
abbreviation XHJC String 20
7 Scope of
jurisdiction
GXF
W String 100
8 Scope of
business
YWF
W String 500
9 Profit model YLMS String 100
10 City SZCS String 6
A1distionary
table of districts
and counties
Mandatory
11 Office
address BGDZ String 200
12 Zip code YZBM String 10
URBAN VIEW -33-
13 Contact
person LXR String 50
14 Telephone LXDH String 50
Multi-valued
15 Fax CZ String 50
Multi-valued
16 Email DZYJ String 50
17 Website WZ String 50
18 Operational
status YYZT Short
A166 dictionary
table of appraisal
company’s status
19 Date of
establishment CLRQ Date
20 Remarks BZ String 2000
Table 3-2-2-2-3 Data structure of public facilities of Qiu (table name: QGGSS)
No. Field Code Field Code Field Type Field
Length
Number
of
decimal
places
Range Constraint
condition
1 Public facilities
ID of qiu QGGSSID Integer
>0 Mandatory
2 Code of qiu QBM String 20
3 Number of
markets within X km
CCS Number 6
4 …… …… …… …… …… …… ……
7 Number of
supermarkets within X km
CSS Number 6
8 …… …… …… …… …… …… ……
11 Number of
shopping malls within X km
DMCS Number 6
12 …… …… …… …… …… …… ……
15 Number of
banks within X km
YHS Number 6
16 …… …… …… …… …… …… ……
19 Number of
schools within X km
XXS Number 6
20 …… …… …… …… …… …… ……
URBAN VIEW -34-
23 Number of post offices within X
km YJS Number 6
24 …… …… …… …… …… …… ……
27 The nearest
general hospital ID
ZJZHYYID Integer
28 …… …… …… …… …… …… ……
34 Status ZT Short
A47 dictionary
table of status
Mandatory
4. Dictionary Table
A.1~A.212 list the dictionary table used in this standard. Each dictionary table shall
include three fields. Once the dictionary table is finalized, revision will not be
allowed. New codes cannot be the same as the existing ones.
For example, A. 197 dictionary table of land nature codes is formulated based on the
Code for Classification of Urban Land Use and Planning Standards of Development
Land GB50137-2011.
Code Name H Construction land H1 Urban and rural construction land for settlement H11 Urban construction land H12 Town construction land H13 Township construction land H14 Village Construction land H2 Land for regional transportation facilities H21 Railway land …… …… 98 Others 99 Not clear
URBAN VIEW -35-
IV. Prospects of unified data standard
The formulation of the unified data standard commences from the basis. Through
building the most basic units – Shanghai Land Valuation Data Standard – with the
help of innovative computer hardware, network system, information technology, and
following the principles of “resources sharing and information exchange”, we aim to
provide a foundation for the construction of an industry database and comprehensive
land information system integrating information such as land type, location, area,
layout, ownership, administration. At the same time, we hope that the unification of
land valuation data standard can facilitate the data integration, enhance the data
mining technology, improve the data analytical technique in the industry and broaden
the land valuation businesses.
Of course, the foregoing proposal of the unified data standard is just a theoretical
study, which must be enriched and deepened with the practice. However, the
development direction of unifying data standards in the valuation industry is correct.
The coming of big data era brings both opportunities and challenges to the land
valuation industry and even to the whole land industry. The future development of
land industry will be tightly bonded to “big data”. “Big data” is a kind of data
resources useful to various demands instead of simple storage of massive data.
Unifying data standards is the first step of converting data into data resources. We
believe that as the issue of unifying data standards gains increasing attention, the
foregoing unified data standard will be continuously improved and make due
contribution to the informatization of appraisal industry.
URBAN VIEW -36-
News Guidance
New Advertising Law coming soon
Controlling home price is a key objective of real estate regulation
Real estate enterprises explore the bond market
Who shall pay for the frequent building collapse
Wanda plans to slash 40 dept stores amid transformation
URBAN VIEW -37-
Policy New Advertising Law coming soon
The newly amended Advertising Law will take effect as of September 1, 2015. The
revised version stipulates that in real estate advertisements, the listing information
should be authentic, the area information should be specified as gross floor area or
gross internal floor area, and the advertisement is not allowed to include the following
content: commitment on appreciation or ROI, terms violating the state provisions on
price administration, and misleading marketing of transportation, commercial, cultural
& educational facilities or other infrastructures. In addition, real estate advertisements
are not allowed to include any content of feudal superstitions, such as feng shui and
divination, or any commitment on household registration, employment and school
enrollment.
Urban View:
Nowadays, in addition to be more and
more eye-catching, beneficial
temptation has also become a focus of
project marketing. However,
developers often register a project
company for a specific project. After
the selling activity ends, the project
company will be cancelled while the
developer cannot meet the
commitment, which is the reason why
there are so many complaints in real estate industry. The new advertising law
legislates for the rules and regulations not implemented in the field of real estate
advertisement. In the future, there will be laws to abide by in real estate advertising,
which is a step forward to some extent.
URBAN VIEW -38-
Policy Controlling home price is a key objective of real estate regulation
At the Ninth Plenary Session of the Tenth Shanghai Committee of CPC, Hanzheng,
the Secretary of Shanghai Municipal Committee of the CPC said in his speech that
“we shall keep an eye on the trend of real estate market, support people’s rigid
demand for housing for personal use and second homes while firmly implement
purchase limitation policy and curb speculative demand to prevent irrational purchase
driven by speculation. The home price in Shanghai has been very high; therefore,
controlling the home price is an important objective of Shanghai’s real estate
regulation for stable and sound development.”
Urban View:
Different form the real
estate regulation in the
form of administrative
order in the previous years,
this regulation adopted
public opinion guidance
plus the way of tightening
related policies. The
reasons include two: one is that the real estate market has not come into an
uncontrollable situation yet so mild regulation is more beneficial to market stability
without drastic fluctuations; the other one is that the real estate market currently is
still an important pillar supporting real economy so it remains a sector to be protected
in the throes of economic recovery. Based on these two points, the current situation
will continue in a certain period. If there is no significant uptrend, the government is
unlikely to provide pressures on the real estate market.
URBAN VIEW -39-
Finance Real estate enterprises explore the bond market
According to incomplete
statistics, in July, there were 28
listed real estate enterprises
announcing their financing
plans, which totaled RMB 139.7
billion. Notably, the financing
plans of Evergrande, Wanda
Commercial, Longhu, Vanke,
BCDC, Risesun, and Calxon all exceeded RMB 5 billion.
Urban View:
There are many financing channels at home and abroad for real estate enterprises,
especially those large-scale listed real estate enterprises. Why did corporate bonds
become so popular recently? Mainly because it was a less difficult and costly way.
The attention of real estate enterprises to financing cost came from the overall decline
of profits in the real estate industry. During the “golden ten years” of real estate
market with high-speed development, the profit margin of many listed real estate
enterprises could reach 30%. However, with the rapid rise of land price and the
growth of various costs for development and construction as well as the regulation of
home price, the profit margin of some real estate enterprises now has declined below
20%. Of course, the popularity of corporate bonds has much to do with the
stock-market turbulence. The stability of corporate bonds was thus highlighted during
this period and attracted many conservative investors. As the market size of corporate
bonds grows, the participation of appraisal companies will be needed to provide more
specialized services for the issuance and valuation of corporate bonds.
URBAN VIEW -40-
Market Who shall pay for the frequent building collapse
On July 27, a building completed in 1980 in Hangzhou collapsed, which drew the
public’s attention to housing quality again. This collapse was not an individual case.
On June 9, a residential building in Guizhou collapsed. On July 4, a shoe factory in
Zhejiang collapsed and 14 persons died. On July 6, the balcony of an apartment unit
on the 7th floor suddenly collapsed.
Urban View:
According to design code, the designed life of ordinary residential housing is 50
years. However, for various reasons, the actual service life is always lower than the
designed one. It is also said that the service life of some residential housing (namely,
those completed before 1985) may be only 30 years. Taking Shanghai as example, if
the maximum service life is 30 years, according to incomplete statistics, more than
one million units will become so-called “dilapidated housing” in these years,
accounting for over 15% of the inventory housing in Shanghai. Therefore, building
collapse is truly a social issue cannot be neglected.
Shanghai’s exploration in the renovation of old buildings is worth learning. The
reconstruction and expansion of old buildings and the rebuilding of dilapidated
buildings after demolition do not only solve the problem of dilapidated buildings but
also improve the residents’ living environment and city appearance.
URBAN VIEW -41-
Market
Wanda plans to slash 40 dept stores amid transformation
Recently, Wanda Group announced internally that it would shave off more than 40
department stores running at a heavy loss in Jinan, Tangshan, Jiangmen, Wenzhou,
Shenyang, Jingzhou, etc., and would reduce the area of some stores in Shanghai,
Quanzhou, Xiangyang, etc. According to some statistics, there have been over 90
Wanda department stores nationwide. Wanda replied that it was a normal adjustment
amid Wanda’s fourth transformation. Wanda would cut its reliance on the traditional
businesses and shift its focus to more promising businesses such as culture, tourism,
sports.
Urban View:
Although Wanda said the
closure of stores was related to
its strategic arrangement, we
think the underlying reason
was the decline of profits from
department stores, which was
also the primary cause of its
transformation.
Actually, under the negative
impacts of e-commerce and
high costs of human resources and rental, Wanda was not the first large mall closing
its department stores. Many international giants of department store sector, including
Parkson, Marks & Spencer, Wal-Mart, also started to close part of their stores in
China.
URBAN VIEW -42-
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reference. The academic articles in this publication shall not be published on the
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the source of information shall be indicated.
2. All the information and data published in the issue are derived from our
integrated analysis and only for reference. We do not take any legal responsibility
for its accuracy.
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