CRIC Real Estate Research: The land market in March is showing a sporadically hot trend, with land auction activities in core cities continuing to heat up.

Ke Rui Real Estate Research pointed out in a document that the land market was hot in March, with land auctions in core cities continuing to heat up. The average premium rate was 17.1%, an increase of about 6 percentage points compared to the previous month. High-priced land parcels with high premiums were transacted in cities such as Beijing, Shanghai, Hangzhou, Suzhou, and Chengdu. Among the top 10 cities in terms of transaction amount this month, 6 cities had an average premium rate exceeding 10%, with Hangzhou and Suzhou reaching as high as 42% and 38% respectively. Thanks to the innovative high floor prices in cities such as Beijing, Shanghai, Hangzhou, and Chengdu, as well as the sustained confidence on the demand side, the land auction confidence remains high in 2025. Investment amount, top 100 threshold for building area and total price increased by 18% and 14% respectively. As of the end of March, the threshold value of the top 100 new land reserves was 11.7 billion yuan, a decrease of 19% year-on-year, but the decrease was 10 percentage points higher than the end of February; the threshold value of the top 100 new total price was 5.3 billion yuan, an increase of 18% year-on-year; the threshold value of the top 100 new building area was 171,000 square meters, a slight increase of 14% year-on-year, with the growth rate narrowing compared to the end of February. The land acquisition amount of the top 100 investors increased by 42.2% year-on-year in the first quarter. In March 2025, the total value of new land reserves, total price, and building area of the top 100 real estate developers totaled 622 billion yuan, 317.1 billion yuan, and 33.56 million square meters, with a year-on-year increase of 17.8%, 42.2%, and 5.1% respectively. The three indicators of the top 100 investment companies all rebounded compared to the same period last year, showing an increase in investment enthusiasm. Sales concentration of the top 100 continued to rise, with a land acquisition to sales ratio of 0.3 In the first three months of 2025, the concentration of land acquisition among the top 100 real estate companies continued to rise, with the top 10 companies accounting for 75% of the total new value, an increase of 13 percentage points from the end of 2024. The market is further concentrating on leading companies; in addition, the new value of the top 11-20 companies accounted for 13%, top 21-30 accounted for 3%, top 31-50 accounted for 10%, and the remaining 50 accounted for only 3%. In terms of land acquisition to sales ratio, the top 100 real estate companies' land acquisition to sales ratio in January-March 2025 rose to 0.3, an increase of 0.13 from the end of 2024, mainly driven by the significant land acquisition amounts of certain leading companies, such as CHINA JINMAO, Hangzhou Binjiang Real Estate Group, and GREENTOWN CHINA, whose land acquisition to sales ratios are much higher than the overall top 100 level. The top 10 sales leaders in the first quarter saw a 162% year-on-year increase in land investment acquisition amount. In the first quarter, there was a "differentiation" trend in enterprise investments. On the one hand, nearly 70% of the top 100 in sales did not have land reserves, maintaining a cautious investment stance. On the other hand, leading sales companies increased their land acquisition efforts compared to last year, driving a hot land market. The top 10 companies in sales were the most proactive in land acquisition, with a total land acquisition amount (all-caliber) of nearly 177.5 billion yuan in the first quarter, a year-on-year increase of 162%. Eight of these companies were among the top 10 in land acquisition amount, continuing to invest in high-quality land parcels in core cities over the past two years. Among state-owned enterprises, CHINA RES LAND, China Overseas Land & Investment Ltd., and China Merchants Shekou Industrial Zone Holdings Co., Ltd. had land acquisition to sales ratios exceeding 0.6, with significant increases in the amount, at 92%, 1768%, and 183% respectively. Compared to last year, with the market stabilizing and more high-quality land parcels being supplied, state-owned enterprises have taken a more front-seat approach in investment allocation. Local state-owned enterprises, such as YUEXIU PROPERTY and Jianfa Real Estate, have also been actively acquiring land in first-tier and core second-tier cities such as Beijing and Chengdu to fill future high-quality saleable values. Hangzhou Binjiang Real Estate Group continued to focus on its main business, with land acquisition in Hangzhou accounting for 94% in the first quarter. Overall, leading companies' investment strategies are converging: first, they are selecting high-quality land in core cities and have lower interest in peripheral areas; second, they prefer well-located, low FAR, small land parcels that ensure security while maintaining flow rates. Key land auction heat remains sustainable, and investment concentration will continue to rise. In the period from January to March 2025, the land market continued to show significant differentiation. Land transaction premium rates in first-tier cities such as Beijing, Shanghai, Hangzhou, and Chengdu continued to rise, with high premium transactions for high-quality land parcels in core locations driving market heat and attention back to an upward trend. However, it is worth noting that this round of market warming shows obvious structural characteristics, with third and fourth-tier cities experiencing a decline in both quantity and price, indicating that the market recovery still lacks momentum and substantial improvement will rely on the recovery of regional economic fundamentals and continued policy support. From the perspective of real estate developers, leading companies continue to strengthen their strategic land reserves in high-energy-level cities, with an increasing number of companies participating in bidding for key land parcels and intense competition in bidding prices. Market concentration is further differentiated, with leading companies and state-owned enterprises accelerating the optimization of their land reserves leveraging their financial advantages, while small and medium-sized real estate companies continue to shrink their investment radius due to liquidity pressures. This investment pattern is expected to drive the continuous aggregation of high-quality land resources to leading companies, leading to a new cycle of industry concentration.