CRIC Real Estate Research: The transaction volume of foreclosed houses in October maintains a high level within the year, and the transaction rate has returned to above 20% as expected.

On November 13th, Ke Rui real estate research released that in October 2025, the supply of foreclosed properties fell sharply compared to the previous month, while the transaction volume remained high. This month, there were 29,000 foreclosed properties listed for auction, a 31% decrease compared to the previous month and a 13% decrease compared to the same period last year; 5,169 properties were sold, a 3% increase compared to the previous month, continuing the trend of over 5,000 properties sold for the third consecutive month. The bidding enthusiasm remained low, with a median premium of 9.7% for sold properties, and approximately 5.3% of sold properties received bids over 100 times. Key points - Listing volume: Decreased compared to the previous month, with a new low in listings since the second half of the year, with 29,000 new listings. - Transaction volume: High and continuous, with 5,169 properties sold, marking the third consecutive month with over 5,000 foreclosed properties sold. - Transaction rate: National average transaction rate at 21%, showing a timely increase. - Discount rate: Both average discount rates for listed and sold properties have increased, with the seller's discount rate increasing significantly. Outlook The transaction volume of foreclosed properties remained at a high level in October, with over 5,000 properties sold for the third consecutive month. However, the market heat remains low, as seen from the trading indicators: 34% of properties sold at the base price, reaching a new high for the year; only 5.3% of properties received bids over 100 times, the lowest for the year. It is worth noting that with the increase in the willingness of sellers to discount and supply adjustments, the average transaction rate increased this month, returning to the annual average level. In special cases, the phenomenon of ordinary second-hand properties being sold through foreclosure channels is becoming more common, with about 9.4% of sold properties being normal assets sold through regular transactions. The median premium for these properties is as high as 28 times, indicating that the foreclosure channel is being used to expedite the turnover of real estate. In major cities like Shenzhen, Guangzhou, and Shanghai, there were more than 10 such transactions this month, underscoring the importance of ordinary second-hand properties in the foreclosure market and facilitating the circulation of residential rights. These properties include normal assets sold by individuals through auction companies, as well as bank-owned assets used as collateral. At the individual listing level, several properties with total prices exceeding 100 million yuan were introduced to the foreclosure market this month, such as the Wanlu Lake Hotel project in Heyuan and 44 properties in the Xindi Central Plaza in Shenzhen. With the trend of general inventory pressure in various regions becoming evident, it is expected that more large-scale projects will enter the foreclosure market in the future. Most of the high-priced foreclosed properties have clear profit expectations or scarce attributes, as seen in typical cases: a villa in the Qiaocheng Pure Waterfront area of Nanshan District in Shenzhen, with actual usable area exceeding 2,000 square meters, set a new record for foreclosed property transactions at 360 million yuan; a clubhouse project in the main urban area of Xiamen was sold for 112 million yuan, with a premium of 41%, thanks to its advantage of an annual rent of tens of millions of yuan. The "Fifteenth Five-Year Plan" for October proposed a focus on investment, development, and sales system reforms for new properties in the real estate sector. However, the foreclosure market, as a key element of real estate risk management, should also receive sufficient attention. Considering the current situation in the industry, with a broad inventory in the billions of square meters, corresponding to at least hundreds of billions of yuan in stock awaiting disposal, the industry should fully utilize the foreclosure market and other risk management mechanisms. Faced with the reality of a large number of bankruptcies and mortgaged projects entering the foreclosure or asset disposal stages, local authorities should consider the supply of low-priced properties through the foreclosure market when formulating housing development plans to avoid new inventory accumulation; especially in the construction of affordable housing, they can focus on suitable projects with clear property rights, acquire large projects for conversion into affordable housing to achieve dual benefits of inventory digestion and affordable housing supply. Listing volume: Supply size falls sharply to a new low since the second half of the year On the supply side, there were 29,000 new listings in October, a 31% decrease compared to the previous month and a 13% decrease compared to the same period last year. The total starting price was 27.1 billion yuan, a 33% decrease compared to the previous month. The number of new listings this month was the lowest since the second half of the year. Looking at the situation in various cities, this month saw 5 cities with new listings of over 500 properties, a decrease of 5 cities compared to the previous month. Chongqing had 1,430 new listings this month, leading among all cities. The 5 cities with over 500 listings accounted for a total of 4,450 listings, representing 15% of the total new listings nationwide. Among the first-tier cities, Guangzhou had 360 new listings, ranking first, followed by Shenzhen with 215, Shanghai with 163, and Beijing with 128. In terms of total starting price, Shenzhen had the highest with 12.8 billion yuan, followed by Shanghai with 9.3 billion yuan, Beijing with 7.9 billion yuan, and Guangzhou with 6.7 billion yuan. This month saw 10 properties with starting prices exceeding 100 million yuan, all of which were large-scale real estate, commercial complexes, or multiple properties listed together. The highest starting price project this month was the Wanlu Lake Hotel project in Heyuan and its surrounding commercial street, garden villas, and hotel apartments, with a sale price of 700 million yuan, accounting for 71.5% of the reference price of 979 million yuan. The project is located in a 4A-grade Wanlu Lake scenic area, with an investment of over 1 billion yuan, a total construction area of 137,000 square meters, including a hotel section of 110,000 square meters, a commercial section of 8,000 square meters, garden villas of 9,000 square meters, and hotel apartments of 8,000 square meters. Due to debt disputes and other issues, the hotel ceased operations in 2023 and initiated the foreclosure process in August 2025, after the initial auction of 790 million yuan was unsuccessful. The scope of the second bid was reduced to 113 hotel apartments and 21 villas, but still did not sell, entering the liquidation process in October. The hotel has complex leasing arrangements, with some properties leased for over 10 years, and the overall asset valuation is high. Combined with previous property disputes and illegal structures, this sale is expected to face multiple challenges. After being listed for auction twice, 44 properties in the Xindi Central Plaza in Shenzhen entered the liquidation process this month, with a price of 264 million yuan, only 56% of the reference price of 471 million yuan, with an average price of 8,400 yuan/square meter. With approximately 25 million yuan in outstanding property fees, the average price is about 9,200 yuan/square meter. Transaction volume: Continues at a high level, with a 3.6 billion transaction for a luxury villa in Shenzhen, with a premium of 69.5% In terms of transactions, typical cities saw 5,169 foreclosed properties sold in October, a 3% increase compared to the previous month and an 8% increase compared to the same period last year, remaining at a high level for the year. The total transaction amount for foreclosed properties this month was 5.9 billion yuan, a 4% increase from the previous month. Bidder enthusiasm remained at a low level this month, with 66% of properties sold at a premium, and the median number of bids for sold foreclosed properties was 14, consistent with the previous month. 5.3% of properties received bids over 100 times, a decrease of 0.2 percentage points from the previous month. Guangzhou had the highest number of foreclosed property transactions this month, reaching 205 properties, with Wenzhou, Hangzhou, and Ningbo ranking 2nd to 4th, all with transaction volumes of at least 150 properties. In terms of transaction amounts, Shenzhen led with 840 million yuan, followed by Shanghai with 580 million yuan, Hangzhou with 440 million yuan, Guangzhou with 330 million yuan, and Beijing with 220 million yuan, with other cities below 200 million yuan. There were several properties in various cities this month with low starting prices for foreclosed properties, where the transaction prices were over 10 times the starting price. These properties totaled 352 properties, accounting for 7% of the total transactions this month. Without exception, these properties were normal assets involved in regular transactions, rather than common types of foreclosed properties involving litigation, bankruptcy, or legal issues. While extreme cases of "1 yuan starting price" have decreased, normal properties involved in regular transactions have become a major part of the foreclosure market. Cities like Weihai, Huizhou, Shenzhen, Guangzhou, Yantai, and Shanghai all saw more than 10 such transactions this month. The highest transaction property this month was a villa in the Qiaocheng Pure Waterfront area of Nanshan District in Shenzhen, which was sold for 364 million yuan on October 31st. The villa has a floor area of 639.35 square meters, planned as a standalone villa with 2 floors above ground, 1 floor underground, and the largest area among the 48 standalone villas in the Pure Waterfront community. Its actual usable area exceeds 2,000 square meters, with a private garden of over 1,000 square meters, facing the lake on three sides and having a lakefront length of 100 meters, located at the waterfront's prime position, known as the "Villa King" of the area, with rare landscape resources and a prime location making it extremely unique. The assessment price for the auction was 307 million yuan, with a starting price of around 215 million yuan, attracting 6 high-net-worth buyers to bid. Amidst over 192,000 views, the property went through 118 rounds of intense bidding, eventually selling at a premium of 149 million yuan, a 69.5% premium rate, with single bid increments reaching million-dollar levels, demonstrating the market's enthusiasm for scarce high-end assets. Looking back at the property's history, the original owner purchased it for 188 million yuan from Overseas Chinese City Real Estate in December 2010, with a value increase of over 176 million yuan in 14 years, showing a significant long-term appreciation potential. Located in the Overseas Chinese City area, known for luxury homes in Shenzhen, the Porto Fino Pure Waterfront series is renowned for its lakefront views and high-end positioning. The hot transaction of this property not only confirms the strong resilience of luxury homes in prime locations during market adjustments but also reflects the long-term confidence of high net worth individuals in scarce real estate assets. With the transparency of the foreclosure mechanism and the improvement of platform services, such core assets are becoming an important benchmark for high-end asset allocation. A clubhouse in the Siming District of Xiamen also sold at a high premium, with the ground and second floors used as the clubhouse, and the basement used as a garage, covering a total land area of 10,000 square meters and a construction area of 12,000 square meters, with a basement civil defense area of 999.65 square meters not yet titled. Originally operated as the Xiamen Junhao Club Hotel, the building integrates garden layout in its design with a high-end positioning. The assessment price was 113 million yuan, with a starting price of 79.13 million yuan. The auction attracted 7 bidders, going through 84 rounds of bidding and 69 extensions, finally selling for 112 million yuan, with a 41% premium, close to the assessment price. According to the foreclosed property disclosure information, the clubhouse's annual rental income (including property fees) can reach a level of tens of millions of yuan, and although the clubhouse's land usage period is less than 5 years, the investment return remains considerable. As a core area commercial asset with stable income and appreciation potential, it is still a prime choice for long-term asset allocation for investors with sufficient capital and commercial operation experience. Transaction rate: In October, the transaction rate rose, returning to a high for the year According to his Cric sampling survey data, the transaction rate for foreclosed properties in October was 21.4%, a 2.1 percentage point increase from the previous month. As expected last month, with the decrease in the foreclosure property supply scale in the fourth quarter, along with an increase in the supply-side discount rate, and more second-hand properties choosing the foreclosure channel for faster transactions, the transaction rate for foreclosure properties increased in October. By city, Shenzhen led with a transaction rate of 45%, followed by Hangzhou, Xiamen, Taiyuan, Fuzhou, Ningbo, Nanjing, Tianjin, Shanghai, and Nanning, all above 30%. The transaction rates for most first and second-tier cities were significantly higher than the national average. Suzhou's transaction rate dropped significantly from 23% last month to 4% this month, mainly due to a large number of unsold commercial-residential buildings at the Yongwei Guxufu complex. These commercial-residential properties have unit sizes ranging from 100-130 square meters, with starting prices in the range of 1.3-1.6 million yuan, facing challenges in the current market environment where the residential market is also struggling. Transaction premium: Only 10% of properties traded above the assessment price Looking at the distribution curve of the "transaction price/starting price" for traded properties, this month saw 66% of foreclosed properties sold at a premium, marking a new low for the year. Among the top 10% of properties with premium rates, the premium rate exceeded 160%, with these properties mostly being regular properties traded through the foreclosure channel but achieving high premium rates since the base price was set so low, their premium rates were much higher than the common types of foreclosed properties involving bankruptcy, litigation, or legal issues. However, as second-hand properties generally do not have corresponding assessment prices, focusing on the "transaction price/assessment price" distribution for common foreclosed properties: only 10% of properties traded above the assessment price this month, with these properties mostly being improvement-oriented homes with clear rights and no residency or leasing disputes, and over 90% being sold in the first auction. However, 65% of properties still required discounts of over 20% to sell, indicating that most foreclosed properties still needed significant discounts to be successfully auctioned off. Starting price discount: Both buyers and sellers prefer to negotiate prices, with a significant increase in discount rates for seller-class properties The average discount rate for foreclosed properties sold in October was 32.7%, a 0.4 percentage point increase from the previous month; the average starting price discount rate for listed foreclosed properties was 29%, an 0.8 percentage point increase, reaching a new high since the second quarter. The gap between starting price discount rates and transaction discount rates narrowed from the previous month by 3.7 percentage points, indicating convergence in the judgment of both buyers and sellers. Both buyers and sellers tended to negotiate prices more in October, with the discount rate for seller-class properties increasing the most. The average discount rate for these properties in October was 32.7%, a 1.2 percentage point increase from the previous month, returning to a high for the year. Influenced by changes in the volume of second-hand property transactions, the discount rate for the foreclosure property market also increased this month. Comparing the differences in discount rates between starting prices and transaction prices, there was a 3.4 percentage point difference for properties sold on the first auction, an increase of 0.3 percentage points from the previous month; a difference of 4.8 percentage points for properties sold in the second auction, an increase of 0.7 percentage points from the previous month; for seller-class properties, there was a 1.2 percentage point difference, a decrease of 1.7 percentage points. Looking at the differences at different auction stages, the understanding of seller-class properties further converged, facilitating the successful auctioning of properties entering the final disposal stage.