On July 22, the Ministry of Housing and Urban-Rural Development released an article on "Thoroughly Implementing the Spirit of the Central Urban Work Conference to Promote Urban Renewal with High Standards and High Quality", emphasizing the milestone significance of the Central Urban Work Conference.

After 10 years, the Central City Work Conference was held again, which gave great encouragement to the industry. The meeting put forward "one optimization, six constructions", and took urban renewal as an important starting point for urban connotative development, reflecting the needs of the times from large-scale incremental expansion to stock quality and efficiency transformation. It clarifies the overall requirements of urban work and points out the direction for high-quality urban development.

So, what is the impact of the Central City Work Conference on the development direction of the real estate industry in the new era? What opportunities are there? Jingtai interprets it for you.

Urbanization: from "rapid expansion" to "seeking progress while maintaining stability"

Let's take a look at a set of data: from 2012 to 2024, the urbanization rate of our country's permanent population will increase from 53.1% to 67%, and the urban population will reach940 million people; During the same period, more than 150 million new urban jobs were created nationwide, and 150 million agricultural migrants were successfully settled in cities. With the gradual improvement of the system and the enhancement of the sense of belonging, the housing demand of these "new citizens" has continued to be released, which has become an important support for the rapid development of the real estate industry in the past 20 years; By 2024, the per capita housing area in urban areas across the country will reach 40 square meters.

In a word: urbanization brings people, and people bring the housing market.

However, this meeting also clearly pointed out that our country's urbanization has entered a period of stable development from a period of rapid growth. This means: urban development has shifted from "a large number of new constructions" to "improving quality and efficiency"; Pay more attention to people-oriented, intensive and efficient, characteristic development, governance investment and overall coordination.

Although the growth rate of urbanization has slowed down, the key point is coming: there is still a gap of nearly 20 percentage points between the urbanization rate of the permanent population (67%) and the urbanization rate of the registered population (currently about 48%); This means that there are still a large number of agricultural migrants who have not really "fallen", and their housing needs are still "rigid demand"; This part of the demand is still the basic market for the future development of the real estate industry. In other words, urbanization continues, and houses still have to be inhabited.

Urban development is no longer "spreading the pie", but "weaving a network"

The Central City Work Conference clearly put forward one of the seven key tasks of future urban development: "Focus on optimizing the modern urban system." "What do you mean? That is to say, cities cannot fight alone, but must develop in a "group" and "networked" manner to form urban agglomerations and metropolitan areas.

For example, like the familiar ones:

Beijing-Tianjin-Hebei (Beijing + Tianjin + Hebei)

Yangtze River Delta (Shanghai, Jiangsu, Zhejiang, Anhui)

Guangdong-Hong Kong-Macao Greater Bay Area (Guangzhou, Shenzhen, Hong Kong, etc.)

Chengdu-Chongqing Twin Cities Economic Circle (Chengdu + Chongqing)

These places are the "main battlefields" of future urban development. In addition, the meeting also emphasized that the county, as an important carrier of urbanization, continues to promote the urbanization of agricultural migrants, the coordinated development of large, medium and small cities, and the integrated development of urban and rural areas.

Cities are the "engine" of modernization, and coordinated regional development is the "fuel" of this engine. The state clearly states:

Build three high-quality development "power sources" in Beijing-Tianjin-Hebei, Yangtze River Delta, Guangdong, Hong Kong and Macao, promote the "river strategy" of the Yangtze River Economic Belt and the Yellow River Basin, and further promote the development of the western region, the comprehensive revitalization of the northeast, the rise of the central region, and the development of the eastern region. These strategies are not empty words, but real policy orientation, which determines where the future capital, industry, and population will go.

For real estate, the core logic is that demand comes from the population, and the population follows the flow of industrial employment. In the future, the incremental demand for real estate will be more and more concentrated in: urban agglomerations, metropolitan areas, and core cities.

Urban classification development: no longer "one-size-fits-all", but "layered"

The policy has made a clear division of the development direction of different types of cities:

Megacities (such as Beijing, Shanghai, Shenzhen): to adopt connotative development, not unlimited expansion, to delineate permanent development boundaries and control scale;

Large cities (such as Chengdu, Hangzhou, Wuhan): to drive small and medium-sized cities, strengthen the radiation driving role, and weaken the "siphon effect";

Small towns and characteristic towns: adapt to local conditions and standardize development, and cannot blindly follow the trend and rush up.

The real estate industry is shifting from "extensive expansion" to "intensive farming", and the core logic of the supply side is:

1. Control the increment and revitalize the stock

strictly control the new real estate development land, and no longer blindly pursue "building new houses"; local governments have increased the collection and storage of idle land and inventory houses through special bonds and other means; Launched the "trade-in" model to help residents in the old city improve their living conditions while destocking.

2. Optimize the incremental structure and focus on urban renewal

focus on the revitalization of inefficient land in the core area of the city; increase the supply of high-quality improved housing to meet the demand for mid-to-high-end housing; In the future, the value of land and housing in the core area of the city will be further improved.

Urban renewal becomes the focus: old houses can also "rejuvenate"

This urban work conference made a clear arrangement for the direction of future urban development, and the core is one sentence: "Build an innovative, livable, beautiful, resilient, civilized and intelligent modern people's city." ”

It sounds a bit long, but it can actually be simply understood as: the city should not only be big, but also live well; not only new, but also warm, cultured and technological; More importantly, it should be safe, green and sustainable. The meeting also emphasized that the main line of future urban development is connotative development, that is, no longer blindly "expanding", but to improve quality, update and optimize.

The city is like a "living body" and needs to be constantly "metabolized". Urban renewal is its most important "renewal mechanism". Current focus directions include:

Renovation of old residential areas (installation of elevators, renovation of water and electricity pipe networks, improvement of green environment)

Infrastructure upgrades (roads, drainage, transportation, smart city systems, etc.)

Improvement of living environment (safer, more comfortable, greener, smarter)

The Minister of Housing and Urban-Rural Development also said: "our country's urbanization is still advancing, and there are more than 30 billion square meters of stock housing in cities and towns that need to be renovated, and real estate still has great potential and space. In other words, real estate is not "no more play", but "the track has changed".

In the past, we pursued "whether there is a house to live in", but now more people are beginning to care: is it safe to live? Uncomfortable? Do you have a sense of technology? Is carbon emissions low? These new housing demands are giving birth to a wave of improved housing market.

In other words, in the future, many houses will not be "demolished and rebuilt", but "repaired and lived well", and the living experience will be improved through micro-updates, small transformations, and intelligent upgrades.

Interpretation of Jingtai|Investment perspective: Where are the "new opportunities" of real estate?

In general, cities can no longer "spread the pie", but must "budget carefully" and emphasize intensive efficiency. This brings two trends:

1. Enhance the value of the core area

Controlling the scale of the city and optimizing the spatial layout means that land in the core area is more scarce and valuable; Urban renewal, old reform, and dangerous old house renovation have made the old city glow with a "second spring".

2. Urban renewal has become a new growth point

Old communities, urban villages, and old commercial entities are all "renewed"; These updates are not "demolished and recovered", but "repaired as new" to improve the quality of living; Such projects will become an important source of growth for the real estate industry in the future.

New housing market: from "seller-led" to "buyer-oriented", in the past it was "built and sold", but now it is "built well to be bought". In the future, the new housing market will present several characteristics: "good houses" can sell well: green, intelligent, safe and comfortable houses are more popular; The price benchmark is being reconstructed: with the entry of high-quality new houses into the market, the housing price structure will be reshuffled; The relationship between supply and demand is being reshaped: from "supply exceeds demand" to "survival of the fittest", high-quality projects are more favored.

As an investor, we must see the trend clearly and seize structural opportunities. In the future, real estate investment can focus on the following directions:

Core urban agglomerations and metropolitan areas: Yangtze River Delta, Guangdong, Hong Kong and Macao, Beijing-Tianjin-Hebei, Chengdu-Chongqing and other regions, population inflow, industrial agglomeration, and stable housing demand.

Urban renewal and old renovation projects: The renovation of old residential areas, the renewal of urban villages, and the revitalization of existing properties are all the focus of policy support.

High-quality improved housing: mid-to-high-end residences, green buildings, smart homes, etc., in line with the trend of consumption upgrading.

Policy-supported housing: affordable housing, rental housing, co-ownership housing, etc., have long-term growth potential.

Real estate platforms with the ability of "integration of investment, construction and operation": enterprises that can integrate resources and have operational experience will have an advantage in urban renewal.

To sum up: real estate is not a "sunset industry", but a "sunrise industry in transformation" - from "building more" to "building well", from "selling fast" to "living longer".