domeet webmaster

There is an inter-regional rotation in the rise in house prices, and high-value areas will rise first, and then drive up low-value areas.

In the long run, the closer Shanghai is to the city center, the bigger the increase.

Commuting improvement is an important factor affecting housing prices, which will bring inter-regional prices closer.

For the replacement passengers, the relative increase in house prices is more important than the increase in the property itself.

Assuming that the price of a city’s suburbs and urban areas is 10,000 and 20,000 respectively, how will house prices change after experiencing urban development and economic growth?

How will house prices change? (single choice)

A. Maintain a gap when growing. For example, it rises to 20,000, 30,000

B. Keep the ratio when growing. For example, it rises to 20,000, 40,000

Let’s see what Shanghai’s answer to this question is. Over the past decade or so, Shanghai’s housing prices have generally risen. After 2006, Shanghai’s housing prices experienced two rapid increases, from 2007 to 2010, and from 2014 to 2017, and the rest of the year was relatively stable.

图: The average price of new commercial housing in Shanghai in 2006-2019

Data Source: Shell Research Institute

In the overall rise of the picture, the change is different. Here, the area of ​​Shanghai is divided into loops, divided into inner ring and inner ring.There are five areas between Central (hereinafter referred to as “inner Central Ring”), Central to Outer Ring (Chinese and Foreign Ring), Outer Ring to Suburban Ring (outer ring), and suburban area. At the same time, the price index for each of the loop regions in 2006 was used as the benchmark price to calculate the price index for the following years. It can be seen that from 2006 to 2019, the growth of the ring roads was different. The inner ring and the Chinese and foreign rings rose the most, and the price in 2019 was eight times that of 2006. The rise outside the suburbs was the lowest, and the price in 2019 was six times that of 2006. The increase in the vicinity of the central city is higher than the increase in the suburbs.

图: 2006-2019 Shanghai sub-ring price index (2006 = 100)

Data Source: Shell Research Institute

There is a regional rotation in the rise in housing prices, and the city drives the suburbs

Is it OK to buy near the downtown area? From the chart below, we can see which region has the highest increase (the most cost-effective) when buying. If it was bought before 2010, it will be the highest in China and the outer ring and the inner ring in 2019. If it is bought after 2010, it will be the highest outside the outer ring and the suburb.

图: 2006-2019 purchase, increase in 2019 sales

Data Source: Shell Research Institute

It can be seen from the annual increase of each ring line that the two rising cycles are first within the inner ring and the inner ring, then passed to the outer ring and finally to the outer ring and suburban ring. outer. For example, during the upswing cycle from 2014 to 2017, the first and the inner ring led the rise in 2014 to 2015, and then the three regions outside the central region rose the most in 2016 to 2017. There is a rotational transmission effect in the rising process: the high-value area rises first and then passes to the low-value area.

Picture: The increase in the price of Shanghai sub-rings in 2007-2019

Data Source: Shell Research Institute

The closer you are to the city center, the bigger the increase

Now look back at the question of the first article. Take the price outside the suburbs as a benchmark and see the price changes in each loop area. We found that the closer to the center of the city, the faster the increase, and the difference in the increase is also opened, which is the second option in the first answer. The exception is the inner ring of Shanghai, which is slower than the inner ring and the middle and outer ring, faster than the outer ring and suburban ring.

Picture: 2006-2019 Shanghai sub-ring price index (outside ring = 100) and trend line

Data Source: Shell Research Institute

Commuting improvement will bring inter-regional prices closer

The growth rate from the inner ring to the outer ring is higher than that in the inner ring, thanks to the construction of public transportation, such as public transportation, subway, expressway, so that the physical distance between their geographical locations does not change, The time distance has been shortened.

The location of the property is one of the core values ​​of the property, attached to the location, including the time cost to various resource points such as companies, shopping malls, hospitals, schools, airports, train stations, etc. The lower the cost of this time, the higher the value of the property. The construction of public transportation, especially the construction of rail transit, has changed the regional distribution of time costs, making the inner and outer ring regions and the inner ring closer.

The impact of subway construction on urban housing prices is very important. If any door of the robot cat is invented one day in the future, the overall price increase and fall may be difficult to judge, but it must be more even.

Figure: Shanghai Outer Ring Road, Central Link and Inner Ring Line Locations

Data Source: Shell Research Institute

Replacers should pay more attention to the relative increase in house prices

The above analysis is for long-term holdings of real estate, and in the actual transaction, the replacement customer has become the current mainstream buying group, through the replacement transaction, to improve the quality of living.

The mindset of the replacement passenger is usually: If the overall price rises, I expect my house to rise more. If the house price falls overall, I expect my house to fall less. It has risen by 300,000 and has dropped by 300,000, which is the same for replacement. Therefore, in the path of changing houses, if the sale of real estate is the target of outperforming the average increase, the difference can be reduced when replacing.

Affected by the Shanghai transaction tax policy, 5 years is an important node for replacement. Now let’s look at the increase in sales after five years of purchase. During the period from 2006 to 2009, the purchase of the China-Foreign Ring Region had the highest increase in sales after 5 years; from 2010 to 2012, the purchase in the Central Region was the highest; from 2013 to 2014, the region outside the suburbs had the highest increase. The best buying areas are different at different times. In terms of the overall trend, the gap in the increase is shrinking. In 2007, the highest-rising Sino-foreign ring region was 97% higher than the five-year-old suburban ring with the lowest increase, and by 2014, the highest-rising suburbs were only 38% higher than the lowest-rising Sino-foreign ring.

Picture: Selling gains after five years of purchase in 2006-2014

Data Source: Shell Research Institute

Alternative business districts alternately generate price

The above analysis is also true in the business circle dimension, and because the split is more microscopic, the volatility will be greater and it is more likely to obtain excess gains. I won’t go into details here, just look at the example of comparing the same location between business districts. Gucun Town and Zhoupu Town are both in the outer area of ​​the Shanghai Overseas Ring Line, one south and one north, one Pudong and one Puxi, each with two rail transits. They are convenient in transportation and moderate in price. They are the choice of many people’s home buyers, and they can often see the comparison and dispute between the two blocks on the Internet.

Figure: Gucun Town and Zhoupu Town in ShanghaiLocation in the city

Data Source: Shell Research Institute

The price index of Zhoupu is calculated every month based on the price of Gucun. It can be seen that the price of Zhoupu has always fluctuated around the price of Gucun. In other words, if the intrinsic core values ​​of the two business districts are consistent, the price will remain at the same level in the long run. It is very simple to make choices at this time. If there are no special preferences, such as commuting, family location, and local sentiment, buy a relatively cheap business district. For example, Zhoupu in the second half of 2009, or Gucun in early 2017. Regardless of the overall property market in the future, the high probability will be better than the other option.

Picture: Gucun and Zhoupu House Price Index 2006-2019 (Gucun = 100)

Data Source: Shell Research Institute