Opportunities in Dongguan's Property Market
In recent years, Dongguan City's land sales have gained satisfactory results, often being transacted at high premium rates, which reflect the fierce competition in the city's land market. Take this residential land sale in the first quarter of 2018, for example. Vanke snatched up a piece of land in Humen Town's Boyong Community for more than RMB 15,000 per square metre. What could be contributing to this market's continual success?
The city's annual GDP growth last year was higher than that of the whole country and the province, reaching a recent record high of more than RMB 750 billion. In terms of ranking, although Dongguan was lower than Shenzhen, Guangzhou and Foshan, its GDP was twice and three times that of Huizhou and Zhuhai respectively, suggesting its scale of economy should not be ignored. With the continued increase in productivity, both residential home ownership and demand are shown to be increasing. Additionally, there could potentially be a net increase of over 100,000 residents each year from now until 2020, which will add momentum to the urbanisation process, thereby stimulating further housing demand. The connections between the Dongguan Rail Transit Lines No.1-3 and Guangzhou and Shenzhen will greatly shorten the duration of business travels between major cities, resulting in higher property values within Dongguan City.
However, the property market in Dongguan has also been affected by policies in recent years; there is virtually no chance of survival for property speculators. Nevertheless, the authorities' control policy in recent months has yet to be relaxed, and developers are restricted to short-term price increases for their new launches. Within the first five months of 2018, the average price of new homes through online signings has risen 5% year-on-year at RMB 16,910 per square metre. The slight deficiency in new housing supply is unlikely to change within the next half year, and residential property transactions in Dongguan are expected to trend upwards steadily this year. Given the deepening development of the Greater Bay Area, Dongguan's property market is likely to experience healthy continued growth in the long run.