E-commerce giants jump on the real estate bandwagon
Major Chinese e-commerce players are betting big on the real estate market and will sell properties during this year's Singles Day shopping spree, in a bid to increase sales revenue, diversify their product portfolio, as well as inject new vitality to the country's housing sector.
Online retailer JD will release more than 6,000 discounted housing resources in cooperation with over 200 property developers in 70 cities across the nation for the upcoming shopping bonanza, while Alibaba Group Holding Ltd will launch over 10,000 properties on Nov 11.
Cao Lei, director of China E-Commerce Research Center, said property developers are facing great pressure to cut inventories as the government has maintained tight regulations to curb speculation in the property market.
"The e-commerce platforms have become an important channel for real estate developers to boost sales. Meanwhile, Alibaba and JD need such eye-catching commodities with high per-customer transactions to increase the gross merchandise volume," Cao said, while noting this move will have a limited influence on the real estate market.
Cao added Chinese consumers could not only buy daily necessities, but also tourism products, houses and automobiles via online marketplaces.
Zhang Dawei, chief analyst at property agency Centaline, said these moves will have no impact on the property market.
JD officially marched into the country's property market in 2017. It rolled out a site on its online platform targeting property buyers in association with leading developers.
The company said it would take steps to integrate online and offline real estate businesses by creating a one-stop service platform that would integrate its capacities in marketing, services and the supply chain.
In 2014, tech behemoth Alibaba joined hands with real estate developer Vanke to offer discounts to property buyers.
Moreover, it signed an agreement with the Hangzhou city government to use the company's technology to create an online system for house rentals in August 2017.
GuoShiying, an analyst from ZhugeZhaofang, a leading real estate big data and artificial intelligence startup in China, said the discounted properties provided by Alibaba and JD represent an innovative sales model in the property market.
According to the National Bureau of Statistics, new home prices in China's four first-tier cities (Beijing, Shanghai, Guangzhou and Shenzhen) rose by 0.3 percent in August monthon-month, reporting the same increase as the previous month.
In August, new home prices and the secondhand housing prices in 31 secondtier cities rose by 0.5 percent and 0.2 percent month-onmonth respectively, both being 0.2 percentage point lower than the previous month.
Meanwhile, the size of China's cloud computing industry is expected to exceed 300 billion yuan ($42 billion) in 2023, according to a white paper released by the Institute of International Technology and Economy. The document predicts that China's enterprise and government cloud adoption rate will be over 60 percent with its growing demand in digital and intelligence transformation.