Wuhan Rental Market Survey: Slow Season Test, Recovery, Mature Rental Enterprises Waiting For Turning Point

According to the law of previous years, September to December is the off-season of the rental market. After the opening of primary, secondary and primary schools, employment and school district housing rental demand will subside, and the market will gradually decline. The housing rental market will also face a new round of severe tests.

With the economic recovery in full swing, the rental market is still a bit cold.

Recently, Zhuge housing data Research Center released the average rent price report of large and medium-sized cities in China in August 2020. According to the report, in August, the average listing price of rent in large and medium-sized cities nationwide was 43.23 yuan per square meter per month, a slight decrease of 0.05% on a month on month basis and a decrease of 1.75% on a year-on-year basis. Among them, Quanzhou, Qingdao, Wuhan, Shenzhen and Beijing are the top 5 cities with the decline in rent on a month on month basis.

It is worth noting that as the central area of the outbreak of new pneumonia, the housing rental market has suffered a heavy blow, the rent level has continued to decline, and the activity of the rental market is still not high.

On September 8, Huang Hui, a senior analyst at Shell Research Institute, said in an interview with the 21st century economic news reporter: "due to the severe impact of the epidemic in Wuhan, the rental market in the first half of the year, especially in the first quarter, was at the bottom of the trend. From February to March, the market volume dropped to freezing point. With the prevention and control of the epidemic situation in April, the market began to warm up and lasted until the end of August. In terms of rent level, the rent level in Wuhan in early September was 26.4 yuan / m2 · month, down 1% month on month and 9.6% year on year. "

At the same time, a number of real estate agents also told reporters of the 21st century economic report that during the epidemic period, the housing rental market in Wuhan was stagnant, and the transactions of their individuals and even the whole industry were almost "frozen". With the gradual easing of the epidemic situation, the housing of graduates and those who return to work and production just need to be put on the agenda. Intermediary companies have also taken actions to strive for new customers and activate the market.

According to the law of previous years, September to December is the off-season of the rental market. After the opening of primary, secondary and primary schools, employment and school district housing rental demand will subside, and the market will gradually decline. The housing rental market will also face a new round of severe tests.

Huang Hui predicted that with the effective control of the epidemic situation and normalization of prevention and control measures, the heat of rental market is expected to pick up after the Spring Festival next year.

Cold market

Wu Yang (pseudonym), who works in Wuhan, is busy looking for a new house because his rental house is about to expire.

"The original rent is to ask for one to pay three, but now one to pay two is OK." Wu Yang said that she had two or three years' experience in renting a house in Wuhan, and the price of the house will probably increase when it comes to maturity. Therefore, the house is basically changed once a year. However, affected by the epidemic situation this year, she did not find any obvious increase in house prices.

Changes in the rental market have already appeared. Due to the impact of the new crown pneumonia epidemic, from the beginning of this year, the market has dropped to "freezing point" after the Spring Festival, which should be the peak season of traditional housing rental. Zhang Jing, an intermediary for shell to find a house, told reporters: "I started in January this year. In January and February, I didn't have a house deal."

According to the monthly rental report of Shell Research Institute, the total volume of housing rental in 18 key cities decreased by 78.9% month on month in February, with a year-on-year decrease of 82.7%, and a month on month decrease of Wuhan exceeded 90%. Not only the transaction volume decreased, but also the new supply and demand of rental housing market shrank significantly compared with the month of January in which the Spring Festival was located. The new house supply and new passenger source decreased by 47% and 14% respectively.

Zhang Jing said that compared with the same period last year, Wuhan's rental market stock increased, the bargaining space increased, and the rental price continued to decline. "I estimate that the rent will drop between 10% and 20%. For example, the price of a house in Wuzhong Economic and applicable community that I just signed up for recently was 3000 yuan / month, but this time the transaction price is 2600 yuan / month. In the past half a year, the landlord can also be exempted from rent. "

If compared with the same period last year, this trend is more obvious. Last year, the average rent of Wuhan rental market was 40 to 45 yuan per square meter, but in the first half of this year, it dropped to about 30 yuan per square meter, and the time from listing to transaction was longer than last year, from about 40 days to more than 60 days.

Affected by the epidemic, 8.74 million college graduates this year are facing "cloud graduation", "cloud interview" and suspension of employment. Wu Yang also revealed to reporters that most of the new graduates this year were recruited in the fall of last year. This year's spring recruitment was seriously affected by the epidemic situation, and several foreign colleagues chose to leave their jobs and return to their hometown to work.

Zhang Jing also has the same finding: "May and June should be the peak season for graduates to rent their houses. Most of the customers who come to make an appointment to see a house are also newly graduated college students. However, many graduates have not returned to China this year, resulting in a decrease of 20% in the number of house watching customers compared with the same period last year."

However, the good news is that with the gradual control of the epidemic situation and the gradual release of rental demand of graduates and other floating population, the housing rental market in Wuhan has steadily rebounded since the second quarter. According to the data released by Zhuge housing data research center, the average rent price of Wuhan in the 27th week of 2020 is 31.08 yuan / m2 · month, up 1.08% month on month, and the increase is 0.76 percentage points larger.

With the housing rental in graduation season and the alleviation of the epidemic situation, the rental market in Wuhan has been bullish for four consecutive weeks, and the market has recovered significantly, and it is expected that there will be a slight upward trend. Zhang Jing also said: "in July and August, it was obvious that both the rental market and the second-hand housing market in Wuhan were relatively active."

However, with the release of the overall demand of the rehousing population in May last year, there was a reduction in the demand for rental housing in May. The rental market is characterized by "rigid demand" and "centralization". The improved demand for rent replacement is weakened, and the tenants are more sensitive to the price. The supply and demand of the rental market tends to ease, and it is constantly changing to the "tenant" market, and the tenants have more initiative and bargaining space. "

Activation is imminent

In the case of scarce customers, the intermediary industry has taken measures to launch a series of preferential policies to revitalize the market through "profit sharing".

Zhang Jing's agency is also actively negotiating with homeowners to adjust rents. In Zhang Jing's view, in order to achieve long-term win-win cooperation with landlords and customers, it is a decision made according to the current market situation to appropriately adjust the entrusted price through friendly negotiation with landlords and customers.

In addition to the rent adjustment, various preferential policies are also in full swing. "Monthly payment" and "0 deposit" have become the regular preferential policies for graduates of most intermediary companies. In addition, in view of this year's difficult employment and cold market situation, many intermediary companies have increased the size and increased the incentives for graduates. "This year, the company has increased the option of '0 down payment' for the 'Haiyan plan' for fresh graduates, and it can also pay the rent on a monthly basis, with discounts on moving and service fees," Zhang Jing said

In addition to Zhang Jing's company, eggshell takes into account that many graduates can't visit houses on site during the epidemic period, "starling program" aims to provide graduates with a free rent change service within six months; I love my family, it introduces that graduates can enjoy the discount of service fee.

According to the market situation in previous years, after the opening of primary, secondary and primary schools, employment and demand for housing rental in school districts will subside. This year, with the addition of epidemic factors, the market may accelerate to cool down, and the housing rental market is still facing a new round of severe tests. "This year is no exception, especially now that colleges and universities in Wuhan are under closed management, the market has become relatively cold since September," Zhang said

To make matters worse, the frequent negative news of long-term apartments has damaged its brand seriously. "I used to think that the long-term rental apartment could meet the housing needs of young people, with good quality and low price, but after the epidemic, considering the eggshell and various news of difficult operation recently exposed, I may still find a room directly contracted with the landlord." Chen Xiao, who just graduated this year, said so.

Huang Hui pointed out that the cold market is also a good opportunity for the industry to practice "internal skills". Leasing enterprises should further do a good job in capital chain management and fine operation. According to Fang Dongdong's data, in 2019, 53 parents had business problems in renting apartments. There were 45 families with broken capital chain and running away, 4 were acquired, and 4 were in arrears or refusing to pay rent.

One obvious change is that in terms of management, the long-term rental apartments are slowly eliminating the housing resources that are not clear about the property rights of the houses and are managed by the second landlord. "During the epidemic period, many second landlords" ran away "after collecting the rent. In order to avoid risks, the platform has stricter control over the inspection application than before. Now we only accept the houses directly entrusted by the landlord.".

For the development of leasing enterprises in the future, Huang Hui suggested: "first, we should strengthen the inventory management of housing resources. After September, the reduction of rental demand may lead to the increase of vacancy rate. The leasing enterprises need to adjust the speed of house collection according to the rental speed. Second, it is necessary to do a good job in cost control and refined operation, maintain a healthy cash flow reserve, strengthen the maintenance of existing tenants and the operational efficiency of post rental services, build online information, simplify offline processes, and improve efficiency. "