In Depth: Big Data Playing a Bigger Role in Chinese Real Estate

1. A new subsidiary of KE Holdings Inc., Beihaojia, is aiming to transform property development in China with a data-driven "customer to manufacturer" (C2M) model, utilizing Beike’s extensive database of transactions and customer insights to guide decisions from land acquisition through to final blueprints. This approach is designed to respond to the current climate of risk aversion in the real estate industry, replacing speculation with a quest for certainty[para. 1][para. 2][para. 3].

2. Developers are seeking partnerships with Beihaojia for both its design philosophy and powerful sales network, as uncertainty about the real estate market has made risk sharing appealing. Beihaojia leverages its platform’s vast transaction dataset and customer knowledge to collaboratively design real estate projects alongside developers and prospective buyers, reversing the traditional, developer-led process[para. 4][para. 5][para. 6][para. 7].

3. The Chinese property market experienced a dramatic shift in 2021, transitioning from a seller’s to a buyer’s market. Property sales peaked at 1.8 billion square meters worth 18.2 trillion yuan ($2.6 trillion) in 2021, but then saw a sustained decline. Developers can no longer afford even minor misjudgments in land acquisition due to the risk of enormous capital being immobilized in unsold projects, prompting a search for greater certainty in every stage of development[para. 8][para. 9][para. 10][para. 11].

4. By 2025, new residential construction is projected to shrink significantly, with only 430 million square meters of new starts. Meanwhile, the market share of second-hand homes has surged: In top-tier cities, they now comprise 73% of transactions, and exceed 80% in Beijing and Shanghai—reversing the situation of four years earlier when new homes dominated[para. 12].

5. Buyers have become more cautious, with the average customer viewing 17 properties before purchase in January 2025, up from 10 in 2021. This hesitancy has lengthened sales cycles and shifted the focus from salesmanship to product quality. Developers increasingly recognize that the only controllable factor is the quality and relevance of their product, though defining a truly appealing product has become challenging as consumer demands fragment and traditional experience-based strategies are questioned[para. 13][para. 14][para. 15][para. 16][para. 17].

6. To prove its model, Beihaojia began directly acquiring land, such as a 1.1 billion yuan project in Chengdu and a 700 million yuan project in Shanghai. The team conducted extensive customer research at every stage, gathering thousands of questionnaires and hundreds of interviews, directly involving potential buyers in the design process. This approach resulted in design features tailored to specific customer preferences, such as prioritizing scenic views and including foot-washing basins[para. 18][para. 19][para. 20][para. 21][para. 22].

7. However, challenges emerged in balancing customization with cost control and profit margins. In the Chengdu project, construction costs exceeded 30,000 yuan per square meter (higher than the land cost), leading to squeezed profits and extended timelines of 14 months, longer than industry norms. Some industry insiders argue that Beihaojia’s model amounts to detailed market research rather than true personalization[para. 23][para. 24].

8. Although C2M projects successfully converted a higher proportion of surveyed interest into buyers, the fundamental challenge remains: most buyers prioritize price, delivery, and risk over participatory features. Projects tailored too specifically may struggle to appeal to the wider market once survey-driven buyers are exhausted[para. 25][para. 26][para. 27].

9. Beihaojia’s cooperative projects with leading real estate firms have seen stronger results, often topping regional sales charts. Beike’s core value for partners lies less in its data insights than in its potent sales channels, financial strength, and risk-sharing appeal. In 2024, Beike handled 3.35 trillion yuan in property transactions, accounting for 10% of new home and 30%+ of second-hand market shares[para. 28][para. 29][para. 30][para. 31].

10. Despite not planning more self-operated projects, Beike aims to become the industry’s leading data-and-sales partner for hundreds of developments yearly. Some developers are willing to pay extra for its precise product positioning services, but concerns remain about ceding control to a platform that also controls data and sales, mirroring dynamics seen in other tech-driven industries. The sustainability of these new business models will be tested if the market recovers and developer leverage returns[para. 32][para. 33][para. 34][para. 35][para. 36].