Sales of land for residential housing by local government to real estate developers in 100 cities in China amounted to 65.42 million square meters in the January-February period this year, down 18.7 percent year on year, as announced by CRIC, a real estate research institute of E-House, a Shanghai-based real estate transaction service provider. Due to the outbreak of the coronavirus, the slowdown of economic activities in China exerted a negative impact on sales of land. However, compared to the year-on-year decline of 43.5 percent in residential housing space sold in China in the given period, the decline in land sales was much lower.
In the January-February period this year, sales of land for residential housing by local government to real estate developers in 32 second-tier cities reached 28.93 million square meters, down 37.1 percent year on year. However, in March, the sales of land in cities like Suzhou in Jiangsu Province and Chengdu of Sichuan Province have been much more active, reflecting the more optimistic view of real developers of the future prospects for the real estate market in those second-tier cities.
As for March, sales of land will likely see a rebounding trend as the tight liquidity of real estate developers has been eased due to more financing opportunities and also due to local government support. However, whether the land market will pick up will depend mainly on the market for housing sales.