An Analysis of Idle Land in Real Estate Development in China

During the course of the latest round of continual and rapid increase in housing price in China's large and medium cities starting from 2003, real estate developers hoarding lands is generally considered to be one of the most important reasons for it. That is, lots of real estate firms postponed land development and caused a great deal of land to be idle. This paper first discussed the evolution of China's land regulations in real estate development and stipulations on the idle land in some typical countries as research background. Based on it, this paper investigated the characteristics of China's idle land of real estate development in a decade from 1998 to 2007. The results show that the scale of idle land in real estate industry has been already over 1 billion, and 70% of it is accumulated in the last five years. However, the increase rate of annual land area increment purchased and undeveloped is generally decreasing, especially the increase rate is negative in 2005 and 2006. The phenomenon is contradicted with the prevalent statement in the market that the real estate developers are increasingly hoarding the lands in this period.