CRIC Real Estate: The warming of the real estate market will take time to transmit to investments. It is expected that corporate investments will continue to be cautious and divided next year.

Real Estate released an article stating that in 2024, due to the overall industry bottoming out adjustment, corporate cash flow pressure, and other factors, real estate developers' investment intentions and attitudes were extremely cautious. The total amount of new land reserves of the top 100 companies decreased by 31% compared to the previous year, a decrease of 76% compared to the peak in 2020. With reduced investment, the pattern and strategy of land acquisition continued in inertia. On one hand, the trend of "a few central SOEs dominating, with local government investments providing support, and private enterprises continuing to decline" was maintained. In the top 10 land acquisition amounts, central SOEs dominated. On the other hand, focusing on high-energy level cities became the consensus of many companies, with over 90% of investment amounts in first and second-tier cities. Although there was a slight "end-of-year upsurge" in investment, the transmission of sales recovery to investment will still take time. It is expected that in 2025, corporate investment will continue to maintain a cautious and differentiated trend. The threshold for the top 100 new land reserves amount and total price decreased by 17% and 10% respectively in 2024. The total amount of the top 100 companies' investment decreased by 31%, a decrease of over 70% compared to the peak in 2020. Land acquisition to sales ratio for the top 100 real estate companies was 0.17, hitting a five-year low. Concentration continued to increase, with the top 10 real estate companies accounting for 62% of the total new value added. By the end of the year, investments started to rise, focusing heavily on core cities. Although state-owned enterprises (SOEs) continue to dominate the market, their investment scale has decreased by more than 30% compared to the previous year. The trend of investment by SOEs, local government investments, and the decline of private enterprises continued in 2024. City investment platform companies still played a significant role in supporting the land market. While sales have started to recover, it will take time for the recovery to be fully reflected in investments. Companies are still in the process of bottoming out in terms of investment.The body continues to be cautious and differentiated as the main theme.From the perspective of the city, real estate companies will focus on core cities or regions where they have a strong presence. The pursuit of a nationwide layout in the past will no longer continue, and investments in 2025 will continue to focus on core cities and prime land, leading to localized hot markets. From the perspective of enterprises, top national enterprises are expected to continue to lead the market, supplementing high-quality land reserves during the market downturn. Meanwhile, medium and small-scale real estate companies and most private enterprises are expected to continue to wait and see, deciding whether to increase investment based on future market performance.