BUSINESS

China Developers Chase Prime Land as Broader Market Slumps

Published: Jun. 5, 2026 1:27 a.m. GMT+8

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Land construction in Shenzhen's Longhua district. Photo: IC photo

Intense bidding wars for prime residential plots have returned to major Chinese cities, but the selective frenzy masks a deeper contraction in developers’ land purchases.

Between April 1 and May 28, at least 12 premium land parcels in cities including Beijing, Shanghai and Hangzhou drew 1,126 rounds of bidding and sold for a combined 26.9 billion yuan ($4 billion), with an average premium of 36%, according to data released Thursday by E-House China Research and Development Institution.

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Prime plots in Beijing, Shanghai, and Hangzhou saw high premiums (36% avg) and intense bidding, but overall developer land purchases fell 43.9% year-on-year.
Local governments lowered starting prices and improved planning terms for core land parcels to attract developers.
Broader property market remains weak: investment fell 13.7%, new home sales dropped 14.6%, and May land sales were 27% below last year.

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Who’s Who

E-House China Research and Development Institution: According to the article, E-House China Research and Development Institution released data on April 1–May 28 showing at least 12 premium land parcels in Beijing, Shanghai, and Hangzhou drew 1,126 bidding rounds, selling for a combined 26.9 billion yuan with an average 36% premium.

China Real Estate Information Corp.: China Real Estate Information Corp. (CRIC) reported that in the first five months of 2026, land purchases by 100 major developers fell 43.9% year-on-year to 270.8 billion yuan, the lowest in five years. CRIC also noted a 27% annual drop in commercial land sales by area in May.

China Resources Land Ltd.: China Resources Land Ltd. purchased a prime residential plot in Hangzhou's Binjiang district for 4 billion yuan ($550 million) on April 1, 2026, after 127 rounds of bidding, paying a 46.8% premium. This was part of selective land market frenzy in major Chinese cities.

Dahua Group: Dahua Group acquired a prime residential plot in Shanghai’s Minhang district on May 28, 2024, for 3.7 billion yuan ($511 million). The purchase came after 136 rounds of bidding and carried a 40.7% premium, highlighting selective developer competition for prime land despite a broader market downturn.

Changjiang Securities Co. Ltd.: Changjiang Securities Co. Ltd. (长江证券股份有限公司) is a Chinese securities firm. In a June 1, 2025 report, it noted that starting prices for some prime residential plots in cities like Shanghai and Suzhou had been lowered, and local authorities improved planning terms to boost project profitability.

China Index Academy: According to the article, China Index Academy reported that the share of small residential parcels offered across 22 key Chinese cities rose to 43% in the first four months of 2026, up from 21% in 2022, highlighting developers' shift toward smaller, lower-risk plots.

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What Happened When

2022：: Share of small residential parcels offered across 22 key cities was 21%.

Early 2025：: Starting prices for some prime plots in Shanghai's Hongkou district were 85,000 yuan per square meter; in Suzhou, a prime low-density plot near Jinji Lake was offered at 60,000 yuan per square meter for similar parcels.

First four months of 2026：: Share of small residential parcels offered across 22 key cities rose to 43%; real estate development investment fell 13.7% year-on-year to 2.4 trillion yuan; new commercial housing sales by floor area dropped 10.2% to 252 million square meters; sales by value fell 14.6% to 2.3 trillion yuan; new construction starts plunged 22% by area to 139 million square meters.

First five months of 2026：: Land purchases by 100 major developers fell 43.9% year-on-year to 270.8 billion yuan; total value of land acquired dropped 41.7% to 547.6 billion yuan (lowest for the period in five years).

A week earlier (before May 26, 2026)：: Another Fengtai plot was sold for 4.2 billion yuan, a 15.4% premium, after 151 rounds.

April 1, 2026：: China Resources Land Ltd. bought a plot in Hangzhou's Binjiang district for 4 billion yuan, a 46.8% premium, after 127 rounds of bidding.

Between April 1 and May 28, 2026：: At least 12 premium land parcels in cities including Beijing, Shanghai and Hangzhou drew 1,126 rounds of bidding and sold for a combined 26.9 billion yuan ($4 billion), with an average premium of 36%.

May 8, 2026：: A small plot in Ruian, a county-level city under Wenzhou, drew 90 rounds of bidding and sold for 110 million yuan, a 79.7% premium.

May 19, 2026：: China Index Academy report noted the share of small residential parcels offered across 22 key cities rose to 43% in the first four months of 2026 from 21% in 2022.

May 26, 2026：: A plot in Beijing's Fengtai district sold for 1 billion yuan, a 16.4% premium, after 165 rounds of bidding.

May 28, 2026：: Dahua Group acquired a plot in Shanghai's Minhang district for 3.7 billion yuan, a 40.7% premium, after 136 rounds.

May 2026：: In Suzhou, a prime low-density plot near Jinji Lake was offered at 53,000 yuan per square meter; total floor area of commercial land sold nationwide fell 5% from April 2026 and 27% from a year earlier to 21.8 million square meters; total land-sale revenue rose 9% month over month to 67.2 billion yuan, but remained 20% below May 2025.

June 1, 2026：: Changjiang Securities Co. Ltd. report noted starting prices for some prime plots had been lowered from comparable levels in early 2025.