A model residential development aims to catch the eyes of homebuyers last week at a real estate exhibition in Sanya, South China's Hainan Province. (Photo: Chen Qingqing/GT)
For years, tourism has been the driving force behind economic growth in South China's Hainan Province. But more recently, the island province's economy has received a boost from property-buying migrants, primarily from the country's distant northeastern provinces. These migrants, called "snowbirds" in domestic media, have become major buyers in Hainan's real estate market. On a recent trip to several cities and counties on the island during the Spring Festival holidays, the Global Times looked into why a growing number of home buyers from Northeast China has decided to settle in Hainan and the effect this has had on the local real estate market, local infrastructure and services.
Xie Fang, a 64-year-old retired police officer from Changchun, Northeast China's Jilin Province, just spent his first Spring Festival holidays at his own apartment with his wife and granddaughter in Ledong Li Autonomous County, South China's Hainan Province.
He is just one of many "snowbirds" - a term for residents of China's Northeast - who have resettled on the tropical island province.
"About 80 percent of residents where we live are from three provinces in Northeast China - Heilongjiang, Jilin and Liaoning," said Xie, noting that he bought an 80-square-meter apartment for 465,000 yuan ($71,181) in December 2015 in Ledong county, on the southwestern corner of the island.
Despite the nationwide downturn in the real estate market, thousands of homebuyers, especially elderly couples, have been buying property in Hainan over the last few years.
About 6.6 million square meters of residential property in the province have been sold in the first three quarters of 2015, an increase of 2.8 percent from the same period in 2014, according to a report released by the local government in October 2015.
Meanwhile, real estate buyers bought 63.86 billion yuan worth of residential property, up about 1.2 percent year-on-year.
Over 70,000 people have bought property in Hainan, domestic news portal sina.com.cn reported earlier this month.
Many came for a better quality of life. Hainan has clean air, rich biodiversity and the highest average life expectancy in the country. These factors have drawn many potential homebuyers, especially seniors, to the tropical island, the media report noted, citing a survey by Leju Holdings, a spin-off of real estate service firm E-House (China) Holdings.
Flocking 'snowbirds'
After spending the Spring Festival holidays in 2015 at his sister's house in Haikou, the provincial capital of Hainan, Xie visited some other cities in the province and decided to buy his own home. He said real estate was "affordable for middle-class families."
Unlike coastal cities such as Sanya - a popular tourist destination - where demand for holiday homes has been growing for years, "the average home price in other regions such as Ledong is now around 6,000 yuan per square meter," he told the Global Times on Friday, noting that it only takes about 30 minutes to travel from Ledong to the capital after the first high-speed rail line circling the island opened at the end of 2015.
At a real estate fair in Sanya that ran from Wednesday to Friday, about 100 real estate agencies set up booths to show their residential properties.
Locations in cities and counties such as Lingshui, Wanning and Ledong have grown more and more popular with "snowbirds."
"We've sold five apartments on the first day of the exhibition at 12,000 yuan per square meter, which is the average price for a high-end apartment on the east coast of the island," said Hu Fei, a realtor at Poly Property Group Co (Hainan).
Infrastructure around residential areas on the island's east coast is much more developed than that on the west, he told the Global Times on Thursday.
Cities like Wanning, located in the southeast of the province and famous for its hot springs, have become a second hometown for many "snowbirds".
In a supermarket nearby a residential development in the town of Xinglong in Wanning, customers with heavy Northeastern accents selected dumpling wrappers and handmade noodles sourced from Jilin Province.
The supermarket, which is operated by Changchun Ouya (Group) Co, a leading commercial enterprise in Jilin Province, sold many foods from Northeast China such as rice and sour pork.
"Because of the higher transportation costs, these products are much more expensive during Spring Festival," said an employee at the supermarket who refused to be named.
A 65-year-old woman surnamed Wu from Shenyang, capital of Liaoning Province, said she is considering buying an apartment in Xinglong town because of the clean air and the hot spring there, both good for seniors.
"Some of my relatives have already purchased houses here, which has encouraged me to do the same," she told the Global Times at the exhibition in Sanya on Thursday.
Issues to tackle
Real estate investment in cities and counties like Wenchang, Wanning and Lingshui has grown in the first three quarters of 2015, according to the local government's website. For example, the total investment in Wanning's housing market jumped 22.9 percent year-on-year to 6.45 billion yuan.
With more people eager to buy apartments for what they claimed affordable prices of 10,000 yuan per square meter, some areas, such as the island's west coast, need further development.
"In the residential area where we live, there is no bank, and we only have one small clinic in the town," Xie said.
Meanwhile, cities such as Haikou, Sanya and Lingshui are facing increasingly high inventory pressure, Yan Yuejin, Shanghai-based analyst with E-house China R&D Institute, told the Global Times on February 4.
"Investors have been focusing on the coastal cities for years and it won't be easy to reduce inventories in those regions in the short term," he noted.
The price of a home in Sanya ranges from 18,000 yuan to 21,000 yuan, said Hu, the realtor. Sanya, along with Beijing, Shanghai, Guangzhou and Shenzhen, is currently subject to restrictions on home purchases, according to domestic media.
Still, the down payment requirement for first-time homebuyers was recently lowered to 20 percent in all cities on the island except Sanya, which will likely spur more people to buy property in Hainan during the Spring Festival, Yan said.
