China’s real estate companies have been abducted by intermediaries in the past, and even some real estate companies have been threatened by intermediaries. Although the property enterprises were distressed by the intermediaries, they had to cooperate with them because they brought 70-80 % customers for the projects. The situation is changing now because of the coronavirus. As the coronavirus outbreak grows in scale and scope, offline housing transactions almost stagnated, which means that there is no refund, and the capital chain of property companies is becoming tight.
Developers forced into desperation are exploring online house selling. Most of them such as Evergrande, Country Garden, Vanke, R & F, etc. throwing up the mace, announced the policies of online house selling with providing many services such as online VR viewing, online housing selection, live house viewing, online purchasing, etc., what’s more, multiple purchase benefits are provided as well containing purchasing by the lowest price, no reason to check out, and other benefits! All of housing promotions instantly activated the enthusiasm of potential home buyers. Online housing subscribed for one or two billion yuan a day has already become a reality! What a perfect counterattack, this will lead China’s real estate breaking the channel blockade and entering the era of online shopping.
Coronavirus promotes online transactions of real estate in China, but it is also inseparable from the efforts of developers to actively seek change. Now, let us explore the underlying reasons behind this reform.
1 A Good Beginning – Addressing Threshold and Trust
Online house selling is not a new thing. In 2004, Ali established a word-of-mouth network to cut into the real estate sector, which has ended with failure. In 2011, 20 real estate companies including SOHO China, Huayuan, Vanke and Longhu announced the establishment of the “China Real Estate E-Commerce Bidding Alliance”, which organized a group to sell their houses online in the form of auctions, which didn’t set off a wave in the property industry. It is hard to make successes if we don’t address threshold and trust. The first question: threshold, a lot of online house purchase promotions have lowered the threshold for buying a house, take an example, You can “play” by paying 5,000 yuan – subscribing to a house. If you buy it yourself, you can offset the purchase price of 20,000 yuan (yield rate of 300%); if you recommend others to buy, you can get commissions and cash rewards (recommended by yourself) or compensation (recommended by the property sales); if you don’t do anything, don’t worry, the same money can be returned. The threshold for buying a house has fallen to a level where almost everyone can participate. This is typical internet traffic thinking! The second question: trust, when buying a house is the same as shopping online, you can check out without reason and compensate for the difference, it is hard to believe but it is a reality now. Housing companies have followed up on this policy hand in hand, which has almost become standard. This way can well eliminate the worries of customers buying a house online.
2 Customer Needs for Information are Met Easily Online
Real estate has always been regarded as an asset-heavy and offline field, but in fact, the large amount of information needs around real estate is very important to the transaction itself, and it can even influence the transaction. A 2D floor plan, a brochure can sell a house 20 years ago and then emerging exquisite offline sales gallery, landscape demonstration area, but more information is provided, more opaque the industry becomes. Later, with the emergence of intermediaries and real estate platforms, serious information asymmetry problems appear. Customers need authoritative and detailed information to fully understand the house they are about to buy, so the official online sales gallery of the company and its project is a good carrier to cater to the needs of customer’s information. At the same time, it greatly improves the efficiency of communication and the cost of house viewing.
3 From Long-sighted, Online Housing is a Win-win Policy
Although the developers have launched many preferential activities when they are selling houses online, they do not need to pay commissions to the intermediaries, they still make money. And online sales gallery is equivalent to setting up its own customer acquisition channels for developers and they can convert customers on their own. The most important is customers also get more discounts in the process. Online information is open and transparent, so this also makes online housing purchases place higher requirements on developers. They will pay more attention to brand building and provide higher-quality houses to the market. Although it is the customers who benefit on the surface, it is undoubtedly very helpful for the long-term development of real estate companies.
It is a brand-new exploration that solved the problems of the real estate industry during the coronavirus outbreak with super-strong discounts and innovative marketing models. Judging from the current situation, whoever can better understand the online model and better understand the relationship between brand and traffic will be able to enjoy the next stage of dividends. If you have any questions about the article or want to discuss with us, please leave us a comment below or email us: firstname.lastname@example.org.