A cheaper option

By Tu Lei Source:Global Times Published: 2014-3-11 22:28:01

People line up to catch a bus to Beijing at a bus stop in Yanjiao on February 25. Photo: CFP

On roads near the World Trade Center subway station in Beijing's Central Business District (CBD), there are often people presenting housing flyers to passersby.

"Do you want to look at a home in Yanjiao? We have a free shuttle bus for that," they say.

Yanjiao is a small town in North China's Hebei Province, about 30 kilomters away from the CBD, and not far from Tongzhou in eastern Beijing. The town has been described as being on "the East Seventh Ring Road" of Beijing.

With no house-buying restriction policies, cheaper prices and a relatively convenient location, Yanjiao is attracting more and more people who want to buy a home near Beijing.

Booming market

Ge Lili, a 27-year-old employee at a newspaper near the World Trade Center, was one of the early buyers of a new apartment in Yanjiao.

She bought a 92-square-meter apartment in September 2011 at a price of 9,200 yuan ($1,498) per square meter.

"The main reason I bought a house there is the homebuying restriction policies in Beijing," Ge told the Global Times on Monday.

"If it hadn't been for the restriction policies in Beijing, I would have bought a house in Tongzhou," said Ge, who does not have a Beijing hukou (local household registration permit).

In February 2011, in order to curb rising prices in the property market, the local government of Beijing issued rules prohibiting new home purchases by people who already owned two or more apartments. And people without a Beijing hukou could only apply to buy a home if they had documents showing that they had been paying social security or income tax in Beijing for the previous five years.

In January this year, Chen Gang, vice mayor of Beijing, said that Beijing will maintain its housing restriction policies.

Ge is not alone. Wang Kai, an estate agent who has been working in Yanjiao for five years, told the Global Times Saturday that most of the buyers are people from Beijing.

Meanwhile, the local government of Yanjiao has also launched preferential policies to attract buyers.

For a home worth 800,000 yuan, for example, the down payment can be as low as 320,000 yuan, with a monthly mortgage payment of about 4,500 yuan for 20 years, Wang said.

The average Yanjiao house price "is half of that in Tongzhou," Wang noted.

The strong demand has triggered a rise in housing prices in Yanjiao. On the main road near the entrance to Yanjiao, there are nearly 20 sales offices, representing different property projects under development.

The Global Times visited one development named Tianyang City in Yanjiao Saturday, which has an area of 2 million square meters.

According to Wang, residential housing in Tianyang City has now reached a price of 12,500 yuan per square meter, up from 7,000 yuan per square meter in 2012.

Ge also said the price of her home has jumped to 13,000 yuan per square meter from 9,200 yuan in 2011.

Lengthy commute

The adverts for property in Yanjiao claim that it only takes half an hour to get there by bus from the World Trade Center in Beijing, and is even quicker by car.

However, these claims appear to be somewhat optimistic.

"Normally it takes me 40 minutes by bus on highway, but one and a half hours by car in peak hour due to traffic jam," said Ge.

There used to be many fewer people living in Yanjiao. In 2007, there was only one bus going there from Beijing. But now, there are 10 bus routes to the town. Even so, as the local population has grown, passengers sometimes need to queue for nearly one hour just to get on a bus, during peak periods.

According to Beijing's local government, the extension of the city's Subway Line 6, which terminates at its southern end near Chaobai River, is expected to open in November this year. Yanjiao is just across the river from there, but there is no bridge yet, and it has not been decided who will build one - the local government of Beijing or of Hebei.

At the ongoing annual sessions of the National People's Congress and the National Committee of the Chinese People's Political Consultative Conference, Beijing Vice Mayor Li Shixiang said that the government is now working on the joint development of Beijing, Tianjin and Hebei, and will try to find a way to integrate the three regions in terms of functional planning, traffic problems and environmental protection.

Li said improving public transportation is the most troublesome issue.

Beijing,Yanjiao,Tianjin Graphics: GT

Satellite town?

Some have expressed concern that Yanjiao could become simply a satellite town, with no intrinsic life of its own, and with people just sleeping there while working in Beijing.

There is also a risk that it has already grown too large. According to a report by Beijing News in November 2013, there are completed projects in Yanjiao with an area of nearly 2 million square meters that have not yet found buyers.

"Yanjiao has already become a satellite town," Zhang Dawei, research director at the Beijing office of real estate consulting firm Centaline Property, told the Global Times Monday.

It will be hard for Yanjiao to develop its own industries and offer employment, so people who live there will continue to work in Beijing, Zhang said. 

By the east gate of Yanjiao, there is a huge plaza which was intended to have a commercial area of 820,000 square meters upon completion.

Construction of the plaza began in March 2005, and the developer said it would open in 2012. But it is still under construction, and insiders said that it will be hard to attract enough tenants.

As for the residential area, Ge said that the number of people actually living in her community is about 30 percent so far, although nearly all the houses there have been sold.

"Half of the housing in Yanjiao is for investment," said Zhang from Centaline Property, but he is not optimistic about the investment future in the town.

However, estate agent Wang said that now is still a good time to buy property there, as the government is expected to launch more policies to support the development of Yanjiao.

"The housing price will definitely get higher and higher," Wang said.

Posted in: Insight

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