Chinese property
developers are banking on online marketing campaigns, some with rewards
offered, to boost sales and attract buyers as the coronavirus pandemic
continues to roil the market.
Guangzhou R&F
Properties – one of the biggest builders in Guangdong province – said in its
annual results report on Thursday it had sold nearly 10,000 apartments in the
first three days of its campaign that started on Feb 15.
Buyers pay a deposit as little as 3,000 yuan ($424), and can get a refund without any explanation before June 30 if they withdraw. They’re also entitled to a reward of 10,000 yuan if a flat is purchased by any customer they referred to the company.
Property buyers are now more informed and are familiar with buying and investing in properties. Their confidence in online property deals has gone up
Li Sze-lin, Chairman of Guangzhou R&F
The company’s campaign
is similar to, but less aggressive than that of China Evergrande Group –
China’s second-largest real estate developer by sales. The latter’s campaign,
which has received an overwhelming response, offered a further 25 percent
discount on all properties sold between Feb 18 and the end of last month.
China Evergrande was
the only company to post gains in February among the nation’s 100 largest
developers, with contract sales soaring 118 percent to 470 billion yuan from a
year before, according to research group CRIC.
But R&F’s campaign
had little success. Its contract sales in February plunged nearly 59 percent to
2.5 billion yuan, compared with the same period a year earlier.
The developer said it
will continue to leverage its online platform to boost sales and create a more
cost-efficient network.
“Property buyers are
now more informed and are familiar with buying and investing in properties.
Their confidence in online property deals has gone up,” said Chairman Li
Sze-lin.
He said the importance
of generating contracted sales has become a key focus this year from the
liquidity and earnings perspective, as the disruption caused by the pandemic in
the first quarter of the year has brought challenges for the company in
achieving significant growth amid weak market sentiment.
R&F reported
contracted sales worth 138.19 billion yuan last year – up 5 percent year on year,
but below its target of 160 billion yuan. Net profit rose 15.5 percent to 9.67
billion yuan.
The developer set a
quite moderate contract sales target of 152 billion yuan for this year in the
current global market volatility and the impact of the coronavirus.
Another property
enterprise, China Resources Land, posted an 18.3 percent increase in net profit
last year to 28.67 billion yuan, after taking into account a 7 billion yuan
revaluation gain on investment properties.
China Overseas Land and
Investment saw its net profit climb 10.3 percent to 41.62 billion yuan. Core
net profit went up 10.1 percent to 34.30 billion yuan. The landlord had offered
rent reductions of more than 20 million yuan at its shopping malls to relieve
the pressure on partners, as of the end of February.
Bank of America
Securities set a “buy” rating for China Overseas Land and China Resources Land,
and a “sell” for R&F.
On the Hong Kong stock
market, property stocks were mixed on Thursday. The share price of China
Resources Land slipped 5.01 percent to HK$30.35, China Overseas Land dropped
2.29 percent, and R&F hiked 5.21 percent.
The Hang Seng Index
fell 0.74 percent, or 174.85 points, to 23,352.34.
