Middle Finger Research Institute: In May, the land transfer fees for residential use in 300 cities decreased by 7.6% year-on-year, a significant narrowing compared to the previous month.

The Zhongshi Institute stated in a document that in May, the supply and sales of residential land in 300 cities continued to decline compared to the same period last year. The planned construction area of residential land sold was 19.43 million square meters, a decrease of 27.1% compared to the same period last year; the land transfer fees totaled 96.6 billion yuan, a decrease of 7.6% compared to the same period last year, with a significant narrowing of the decline compared to the previous month; driven by high-quality land plots in core cities, the average premium rate increased to 9.5%. Looking at provinces and major cities, in May, the sales of residential land in provinces and major cities continued to decline. Jiangsu, Zhejiang, Guangdong, and Shanghai saw land transfer fees exceeding 10 billion yuan. The first-tier cities performed the best, with sales area and land transfer fees increasing by 57.7% and 33.0% respectively compared to the same period last year, with Shanghai alone having a land transfer fee of 110 billion yuan; second-tier cities saw a decrease in sales area and land transfer fees by 41.9% and 16.5% respectively compared to the same period last year; third and fourth-tier cities had a decrease of 23.8% and 18.5% respectively, with the market operating at a continued low temperature. Overall, in May, the supply and sales of residential land in 300 cities continued to decline compared to the same period last year. According to Zhongshi data monitoring, in May 2026, the total planned construction area of residential land in 300 cities was 32.32 million square meters, a decrease of 24.0% compared to the same period last year; the sales planned construction area was 19.43 million square meters, a decrease of 27.1% compared to the same period last year. In terms of land transfer fees, in May, the land transfer fees for residential land in 300 cities totaled 96.6 billion yuan, a decrease of 7.6% compared to the same period last year. The decrease in land transfer fees was significantly narrowed compared to the previous month, mainly due to the weakening effect of the high base from the same period last year, as well as the continued strong demand for high-quality land plots in core cities, providing some support to the overall land transfer fees. In May, the average transaction floor price of residential land in 300 cities was 4972 yuan per square meter, an increase of 26.8% compared to the same period last year. Overall, from January to May 2026, the average transaction floor price of residential land in 300 cities was 4089 yuan per square meter, a decrease of 15.0% compared to the same period last year. In terms of premium rate, from January to May 2026, the average premium rate for residential land in 300 cities was 6.7%. In the second quarter, high-quality residential land in core cities entered the market faster, and the competition among real estate companies for high-quality resources in core urban areas and mature areas increased, driving the overall premium rate in the market to continue to rise. In May, the average premium rate for residential land in 300 cities rose to 9.5%. Regional and key city land market analysis in May showed that the sales area of residential land in provinces and major cities continued to decline. Jiangsu, Zhejiang, Guangdong, and Shanghai had land transfer fees exceeding 10 billion yuan. In terms of sales, only Jiangsu, Sichuan, Fujian, and other places saw an increase compared to the same period last year, driven by core cities and the low base effect from the same period last year, while sales of residential land in many provinces and cities still showed a decrease compared to the same period last year. In terms of land transfer fees, Jiangsu, Zhejiang, Guangdong, and Shanghai ranked top, with land transfer fees exceeding 10 billion yuan, with Jiangsu and Shanghai seeing a year-on-year increase in sales, but Zhejiang seeing a year-on-year decrease. The difference in premium rates continued, with Shanghai and Zhejiang having average premium rates of 34% and 23% respectively, while most provinces had generally lower premium rates. In May, first-tier cities saw an increase in both sales area and land transfer fees compared to the same period last year; Shanghai, Beijing, and Guangzhou ranked top three in terms of land transfer fees for residential land from January to May. In terms of different tiers of cities, in May, the market differentiation among various tiers of cities further intensified. First-tier cities performed the best, with a year-on-year increase in sales area and land transfer fees of 57.7% and 33.0% respectively, with an average premium rate of 14.7%. Shanghai and Beijing maintained high demand for high-quality land plots, with strong willingness from real estate companies to replenish inventory. Overall, from January to May, the sales area in first-tier cities decreased by 24.2% compared to the same period last year, with a slight increase of 0.8% in sales area, while land transfer fees decreased by 23.6% compared to the same period last year, with an average premium rate of 10.7%, which was still the highest among all tiers of cities. Second-tier cities saw a decrease in various indicators compared to the same period last year, with a larger cumulative decrease. In May, the sales area and sales volume of second-tier cities decreased by 32.0% and 41.9% respectively compared to the same period last year, with an average premium rate remaining at 10.4%. Although cities like Hangzhou, Chengdu, and Suzhou continued to have high demand for high-quality land plots, most cities were constrained by high levels of new housing inventory, leading to a subdued sentiment in land sales. From January to May, the sales area and sales volume of second-tier cities decreased by 35.1% and 42.2% respectively compared to the same period last year, with land transfer fees decreasing by 50.5%, and an average premium rate of 7.4%. Third and fourth-tier cities continued to operate at a low level. In May, the sales area and sales volume of third and fourth-tier cities decreased by 19.0% and 23.8% respectively compared to the same period last year, with land transfer fees decreasing by 18.5% and an average premium rate of only 4.0%, indicating a lack of market activity. With a weak fundamental basis of population outflow and weak demand, local governments became more cautious in land development, real estate companies further reduced their layout, and land transactions were mainly based on the base price or low premium. Overall, from January to May, the sales area and sales volume of third and fourth-tier cities decreased by 17.1% and 17.6% respectively compared to the same period last year, with land transfer fees decreasing by 20.2% and an average premium rate of 3.5%. In May, Shanghai, Hangzhou, and Beijing actively participated in bidding for high-quality land plots, leading in terms of land transfer fees, with Shanghai having land transfer fees exceeding 100 billion yuan. The land market continued to show a differentiated feature of "hot spots" in land auctions, with Shanghai and Hangzhou having average premium rates of 34% and 28% respectively, while cities like Nanjing, Shenyang, and Zhengzhou generally had low premium rates or transactions at base prices, showing a clear uneven market situation. In terms of city concentration, according to Zhongshi data, from January to May 2026, the top 20 cities in the country accounted for 61% of the total land transfer fees, an increase of 1 percentage point compared to January to April, and an increase of 9 percentage points compared to the full year of 2025. The top land transfer fees for residential land in the country were mainly concentrated in core first and second-tier cities. From January to May, Shanghai had the highest land transfer fees for residential land in the country at 395 billion yuan; Beijing ranked second with 300 billion yuan, and Guangzhou and Hangzhou had land transfer fees of over 200 billion yuan, ranking third and fourth respectively.