Real Estate Market "Indian Summer" Sign? Beijing's Two Land Auctions Conclude, Property Prices Show Moderate Recovery

Beijing’s land auction market completed two nearly suspense-free auctions.

On March 18, the highly anticipated SY00-3101-0037 plot in Hedong Station, Shunyi, was won by Beijing Housing and Urban-Rural Development Investment Co. Ltd. with a starting price of 571 million yuan. This followed the sale of the Shunyi New Town Block 5 plot on March 17, which started at 348 million yuan, both of which sold at the minimum price.

Regarding the subdued outcomes of these two plots, Zhang Kai, head of land market research at the China Index Academy, believes that Beijing’s land auction market has shown a cycle characterized by “quality improvement, volume reduction, and high certainty.”

Comparing these two plots, signs of refined land supply management are evident. The Renhe plot sold on March 17 had a floor area ratio of 1.44 and a floor price of about 15,400 yuan per square meter; the Hedong Station plot sold on March 18 had an even lower floor area ratio of 1.3 and a floor price of only 14,000 yuan per square meter, providing a significant cost safety margin.

Zhang Kai pointed out that the market is currently showing a clear “K-shaped” divergence—core areas remain fiercely competitive, while non-core suburban plots are lowering land prices and floor area ratios to focus on “price stability” and “sales security.”

Analysts believe that these mild land auctions are actually a microcosm of a major cycle adjustment.

Previously, Beijing’s Planning and Natural Resources Commission released the 2026 construction land supply plan. The plan allocates 200-240 hectares for commercial residential land, a flexible indicator that is not only smaller than the 240-300 hectares in 2025 but also marks the fourth consecutive year of reduced residential land supply in Beijing.

According to CRIC, considering Beijing’s 7.24 million square meters of commercial residential sales in 2025, the current new land supply for residential projects is significantly below actual market demand, which will continue to promote the optimization and improvement of Beijing’s new home supply and demand relationship.

“A continued reduction in land supply in Beijing signals the regulatory authorities’ clear intention to shift the market from scale expansion to internal development,” said a real estate industry analyst.

The land-side “subtraction” is expected to bring an “addition” to housing prices.

On March 16, the National Bureau of Statistics released the February 70-city housing price index, showing that first-tier cities have led the way in stabilizing and even slightly increasing prices. In February, Beijing’s new commercial residential housing price index rose by 0.2% month-on-month, and the second-hand residential index increased by 0.3%.

“February’s housing price data sends a clear positive signal, indicating signs of structural recovery in the market, with improved products in first- and second-tier core cities becoming the main drivers of the rebound,” said Zhang Bo, director of 58 Anjuke Research Institute. He noted that after a 0.3% month-on-month decline in January, Beijing’s housing prices stabilized in February, breaking the previous months of continuous decline.

Particularly, the targeted relaxation of policies in Beijing and Shanghai has created a supportive environment, effectively activating rigid and improvement-driven demand. The prices of large new homes over 144 square meters in these cities performed well, further confirming the role of improved demand in supporting prices.

Some developers’ judgments also align with market expectations. During the 2025 performance briefing, China Merchants Shekou stated that, based on last year’s performance, Beijing was the city among the four first-tier cities with the smallest decline in housing prices. The main reason was that increased supply in Beijing drove transactions, especially in “good houses” and core areas, which directly led to price increases.

Based on this, China Merchants Shekou predicts that Beijing’s market will continue to recover with further differentiation in 2026. As land supply gradually shifts toward core areas inside the Fourth Ring Road, the number of high-quality projects will continue to grow, and the share of the high-end improvement market will further increase.