Domestic real estate market to consolidate this year

Updated 2018-01-04 10:00:37 China Daily
A saleswoman (center) talks with customers at a real estate sales office in Huaian, Jiangsu province. (Photo by Zhou Changguo / China News Service)

A saleswoman (center) talks with customers at a real estate sales office in Huaian, Jiangsu province. (Photo by Zhou Changguo / China News Service)

A new report by CRIC, a real estate research services provider, indicates that China's real estate market is going to become more consolidated in 2018, as large developers take up increasing shares of the sector.

The report notes that Country Garden, China's top real estate developer by revenue in 2017, had sales revenue of 550 billion yuan (.87 billion), and that a total of 17 developers had annual sales revenues exceeding 100 billion yuan each.

All of the top three sellers, namely Foshan-based Country Garden, Shenzhen-based China Vanke and Shenzhen-based Evergrande had each realized annual sales revenue in 2017 exceeding 500 billion yuan.

"In the future, the market is going to be more consolidated at all tiers. We estimate that the top four housing developers would have combined income of more than 3 trillion yuan. The market is also going to see more developers with revenue of more than 100 billion yuan in the new year", according to the report.

At the same time, the market is going to continue to diverge, with large players taking more market share. The market is going to become more consolidated through mergers and acquisitions, the report said.

It is expected that top 10 players will collectively hold more than 35 percent market share in the future, the report said.

Beijing-based Sunac China came in fourth place with sales revenue of 362 billion yuan, followed by Guangzhou-based Poly Real Estate Group with sales revenue of 315 billion.

"As market is consolidating, market leaders are expected to outperform smaller players, and big players will have more potential for valuation growth," said Liu Feifan, an analyst with Guotai Junan Securities.

A-share listed real estate developers are likely to see increasing yields and profits in their annual results. Some 30 developers have released their annual performance forecasts by Wednesday, among which 20 said they expect growing yields. Six said they forecast 2017 performance would be more than double that of 2016.

A-share listed developers are likely to see increasing scale and profits in 2018, as many high-profit projects are entering into the payment and settlement stage, according to a research note by Oriental Securities.

"The market is going toward 'the winner-takes-it-all' style," the note said.

Also in the News

Nicole Kidman Recalls Oscar Glory: Loneliest Time
Showbiz2016/06/16 13:58July 21 2018 17:41:29

Nicole Kidman Recalls Oscar Glory: Loneliest Time

Attending Shanghai International Film Festival, Nicole Kidman talks about her role in "Grace of Monaco".

Labor Day Travel Peak Starts
Also in the News2014/05/01 12:16July 21 2018 17:41:29

Labor Day Travel Peak Starts

Johnny Depp Delivers a Speech 'Evolve the Future' in 'Transcendence'
Also in the News2014/04/18 13:18July 21 2018 17:41:29

Johnny Depp Delivers a Speech 'Evolve the Future' in 'Transcendence'

Hollywood star Johnny Depp's speech in the upcoming new film "Transcendence" has been disclosed on Friday, April 11th.

Most Watched

News:
China World Business Sports Showbiz Audio
Video:
C4 My Chinese Life The Sound Stage China Revealed Showbiz Video Travel Video
Photos:
China World Fun Travel Entertainment Sports
Travel:
Beijing Shanghai Guangzhou
Lifestyle:
Live Music Opera & Classical Movies Traditional Shows Exhibitions
Learn Chinese:
Chinese Studio Living Chinese Everyday Chinese Just For Fun Chinese Culture Buzzwords