Why did foreclosure houses increase tenfold in Jiangsu and Zhejiang in three years?

On the "Judicial Auction Channel", the number of foreclosures across the country is increasing year by year. This year, the number of foreclosures in Jiangsu, Zhejiang, and Henan has increased significantly. Especially in Jiangsu and Zhejiang, the number of foreclosures has increased tenfold in three years, jumping from more than 20,000 to 260,000.

However, the unsold rate of online auctions is still high. Statistics show that assets with a starting price of hundreds of millions have an unsold rate of over 90%, especially industrial plants, hotels, office buildings, shops and other commercial properties, which have a higher unsold rate. During the hot property market period, residential properties have the highest transaction rate. Good, but unsold photos are also common.

“The private economy in Jiangsu and Zhejiang areas is developed, and companies borrow a lot. When the economy goes down, it becomes more and more difficult to do business, resulting in a broken capital chain and insolvency. In the end, they either run away or are forced to auction by the court. Assets." A person from a company in Zhejiang that specializes in foreclosures said that the significant increase in foreclosures this year reflects the downturn in the real economy.

The number of foreclosures is increasing rapidly

Among the number of foreclosures across the country, the majority are in Jiangsu and Zhejiang. In the past three years, foreclosure housing in Jiangsu and Zhejiang has been experiencing a blowout growth.

On July 25, 2014, there were 24,744 foreclosures in Jiangsu and Zhejiang. In 2015, courts across Jiangsu Province conducted 44,254 online auctions, auctioning 18,336 items, and 7,249 items were sold.

I saw online that as of November 2 this year, there were a total of 128,232 real estate auctions in Zhejiang, including 22,867 in Wenzhou, 20,174 in Hangzhou, and 23,415 in Ningbo. Compared with the previous day, there were also 200 more sets.

There were 133,526 foreclosure houses in Jiangsu, including 25,081 in Suzhou, 19,909 in Wuxi, 12,853 in Xuzhou, and 10,803 in Changzhou. Compared with the previous day, there were 203 more foreclosure houses. These include properties that are ongoing, about to begin, as well as properties that have closed over the past year or so.

“Before last year, there were three auctions. The first auction price was generally 15% off the appraised price. If the auction failed, the second and third listings would be discounted by an additional 15% off the previous one, but This year it was changed, and there were only 2 auctions. Generally, the first auction is 20% off the appraised price, but some auctions start with the appraised price, and some can be discounted at 30%, which varies for different assets. After the 2 failed auctions, it was sold off, and then failed again. , we will not shoot the matter, maintain the status quo, and let the creditors handle it themselves," a judge from a certain district people's court in Wuxi told reporters.

For example, in Suzhou, since December 29 last year, there have been 25,040 foreclosure houses that have been auctioned and currently listed. The first auction failed, and 7,360 units entered the second auction.

Statistics found that among the 500 real estate auctions in Jiangsu with assets worth hundreds of millions, only 40 were successful and the unsold rate exceeded 90. Property types mainly include pure residences, industrial plants, office buildings, hotels, and commercial land.

The 256 units of office real estate at No. 1188-1, Taihu West Avenue, Wuxi City, had an estimated price of 500 million yuan. The price dropped to 324 million yuan in the third auction last year, but it still failed to be auctioned, and no one took over the sale.

Commercial real estate on the north side of Chuangye Avenue in Gaogang District, Taizhou City. The property is currently operated and managed by Red Star Macalline. The price of the auction in August 2016 was 326 million. A person from Suzhou Trust, the creditor of the asset, told reporters that the debtor borrowed the money from Suzhou Trust and could not pay it back, so he had to put it up for auction. The auction failed in the court and is now mortgaged to the creditor. , still looking for a buyer.

Industrial plants are mostly due to company bankruptcy and the need to dispose of assets. The unsold rate of factories exceeds 80%, and the unsold rate of shops exceeds 60%. Residential properties have the highest transaction rate, and they also command a high premium when the property market is booming this year.

In September last year, Suzhou Dingji Real Estate Development Co., Ltd. entered the bankruptcy liquidation process of the court. Dozens of properties in Suhe Dingcheng Garden under its name were auctioned online, but the premium rate was not high, only higher than the auction price. The reserve price is tens of thousands higher, and there are even properties that have failed to sell.

In mid-to-early March this year, foreclosure houses in Hangzhou repeatedly fetched high prices, and the final transaction price of many houses was much higher than the market price.

For example, on April 6 this year, there was a suite of 108 rooms in Building 42, No. 2 Yulan Road, Yuhuatai District, Nanjing City. The planned use of the house was a villa, with a construction area of ​​265.19 square meters. The year of construction was 2003. The starting price was 6.79 million yuan. After 528 bids, , sold for 12.5 million yuan. On October 20 this year, another villa in this community was auctioned, with a construction area of ​​392.29 square meters, a starting price of 22.5 million yuan, and a transaction price of 34.54 million yuan. The premium rates were very high.

Triggered by the break in the capital chain, why are there so many foreclosures in Jiangsu and Zhejiang?

A dealer who is a liquor agent in Jiangsu told reporters that his friend is also a liquor agent. There are currently four houses in Nanjing being auctioned because his clients cannot get the project funds and cannot afford to pay him back. The drinking money caused a chain reaction, the business could not continue, and all the assets were frozen by the bank, including the house that was about to be demolished, and the only way to go was the foreclosure.

"My friend is a distributor of a certain second-tier brand of liquor. Every time he purchases goods, he pays tens of millions, and we are only a district-level distributor." The above-mentioned liquor agent said, Nanjing second-hand housing The market is very good. If you dispose of the property yourself, you can sell it. But if you sell four houses for 10 million and still become insolvent, you might as well file for bankruptcy directly and hand the house over to the court for disposal.

“The private economy in Jiangsu and Zhejiang is developed, and people like to borrow money to do business. Once there is a problem with the business and the debt is insolvent, they will either run away or be forced to auction by the court.” A company in Zhejiang specializes in representing foreclosures. people said.

As seen on the auction website, 8 sets of commercial properties on Yugang East Road, Shipu Town, Xiangshan County, Ningbo, including retail commercial land, commercial and residential buildings, have been transformed into a hotel and are in an idle state. They will be auctioned as a whole according to the current situation. . The sale price of the entire asset was 10.45 million, and the appraisal price was 13.06 million. The first auction failed, and the second auction also failed. It is now in the sale stage.

“The legal representative’s business went bankrupt. He mainly engaged in food processing. He originally used his personal assets as financing guarantee. However, due to blind expansion of the business in the past two years, in addition to investing in hotels, he also opened stores across the country. I opened dozens of shops and went to Hainan to invest in a factory, but because I didn’t know the business, the investment failed.” According to the entrusted agent, the capital chain was broken and the company was insolvent, so it could only go to the asset auction step.

The agent said that although the property market in Ningbo is booming and house prices in the county have also skyrocketed, their house prices in the town have only increased very little and require a one-time payment. Many people still feel financial pressure after looking at it. A bit big.

Another property located in Suiyuan, Qiandaohu Town, Chun'an County, Hangzhou, has a construction area of ​​381.06 square meters. The house was built in 2009, with an estimated price of 7.79 million yuan. The first auction failed for more than 5 million yuan. , the second shot of 4.37 million yuan has not yet started.

“I used to get a mortgage from us. When I bought it in 2009, it cost more than 8 million yuan. I took out a loan of 5 to 6 million yuan and had to repay 30,000 to 40,000 yuan every month. I have been paying it back for seven or eight years. The capital chain for running a business is broken, the loan cannot be repaid, the debt is too much, and the house cannot be afforded,” the bank that provided the loan for the Qiandao Lake auction house told reporters.

“We are a county-level city here, which is different from Hangzhou. The real estate market is not that good, and the information is delayed. This year’s market is much better than last year, but before it was sold, he cut off the supply, so The bank must sue him and has taken legal proceedings to auction it," said the business manager of the loan bank.