It sits in the middle of a vast sales room with faux marble tiled walls, between two red panels, and the wheels bathed in a pile of golden paper: in this setting, the small beige Wuling electric car smiles at the customers of the residence Binjiang, a huge complex north of Xi’an, a metropolis in central China.
Next to the car, a rice pressure cooker, an air purifier, a refrigerator and an imposing electric kettle. So many gifts offered for the purchase of an apartment by this developer who is struggling to find buyers, while Chinese real estate is going through an unprecedented crisis. “The gifts are worth about 40,000 yuan (5,175 euros)but, if you don’t want it, we can give you money directly »specifies a real estate agent in a suit.
The practice is common in China. Officially, developers are not allowed to lower prices beyond a range, often set by local authorities at 10% or 15% of average prices. Some promoters have been accused of “malicious price reduction”.
Treasures of inventiveness
In May, two companies in the town of Kunshan, near Shanghai, were fined for proposing 25% reductions without authorization. “The unauthorized reduction affected the sales of surrounding residences, which disrupted the normal order of the market”had justified the local real estate regulator, to the Chinese press.
In response, developers are deploying a wealth of inventiveness to circumvent these restrictions: they often offer interior decoration, free parking spaces, and sometimes even gold bars for the purchase of real estate. In 2022, some accepted payments in garlic or watermelons.
As a result, despite two years of real estate crisis, official prices are almost stable: prices of new homes have fallen by 0.2% over the past year, and those of existing homes by 2.4%, according to the China Index Academy , a real estate consultancy firm. Due to a lack of declines, the number of real estate transactions plunged 19.1% year-on-year in August, and at least 80 other Chinese developers have defaulted over the past two years.
Arsenal of measurements
The desire to control prices in a narrow band dates back to 2016: the day after a dark year for real estate, the authorities had made purchases easier, lowered interest rates, to the point that a new surge in prices occurred. is produced. In some cities, prices increased by 20% to 30% the following year.
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