Home prices in China’s school districts go off the boil amid crackdown on elitism to ensure balanced allocation of resources
- A home in Shenzhen’s Futian district sold last week for 98,884 yuan per square metre, 42 per cent less than three months earlier
- Transactions in xuequfang, as school district homes are called, have also dried up in the Zhejiang provincial capital of Hangzhou, agents said
China’s home prices are falling in districts where the most prestigious schools are located, as efforts by local authorities to tamp down the home-buying frenzy in school districts are paying off.
A home in Futian, the seat of Shenzhen’s municipal government and the city’s central business district, sold last week for 98,884 yuan (US$15,250) per square metre, 42 per cent less than a home sold in the same neighbourhood three months earlier. The home, measuring 105 square metres (1,130 square feet), is located on Baihua Road, close to where the elite Shenzhen Futian Baihua Primary School is located.
Three months earlier in May, an apartment measuring 127 square metres in the same neighbourhood changed hands for 22 million yuan, or 173,000 yuan per square metre.
The plunge in prices came hot on the heels of a draft policy issued by the Shenzhen government on August 1, in which it proposed the exchange of teachers between different schools in the city to create a “balanced and better allocation” of education resources. The proposal, which remains on paper, would essentially normalise the standards of teaching, and negate any premium associated with home prices around elite school districts.
“That means the gap in the standards between different schools would narrow, and spots in top-tier schools would be less in demand,” said Yan Yuejin, director of the E-House China Research and Development Institute. “Home prices near such areas would therefore be worth less” than they currently go for, he said.
