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  • What are the reasons for the high cost of real estate development

       2026-04-02 NetworkingName1980
    Key Point:I've written a few short texts before i left the country, but i can't believe it's still so loud, so i'm going to go on and talk about it。The last time i said that there were six major problems with the house being sold, and i have analysed this. So today we're going to have a second question: the price is too high. To be honest, high prices are not developmentists' heartbreaks, because they are expensive, and if they are not sold, there i

    I've written a few short texts before i left the country, but i can't believe it's still so loud, so i'm going to go on and talk about it。

    The last time i said that there were six major problems with the house being sold, and i have analysed this. So today we're going to have a second question: the price is too high. To be honest, high prices are not developmentists' heartbreaks, because they are expensive, and if they are not sold, there is a high risk of losing money, and real estate development, if it is not a small amount, could be lost. Don't think i'm talking to developers, and don't think it's scary, because real estate developers don't spend all their money on projects, they don't have enough, they need to borrow money from banks and other financial institutions, and they have a very high financial cost, saying that developers are the biggest gamblers. So, once the project is down, it's not tens of millions. Then why is the development cost so high

    As i have said many times before, real estate development seems to be a windfall, to the point where it is not the developers, but the state and the banks. First of all, taxes. You know what the combined taxes and charges on real estate consist of: some are taxes: property tax, urban land use tax, cropland occupation tax, land value added tax, turnover tax, urban maintenance construction tax and education fee surcharge, deed tax, enterprise income tax, stamp duty; others are administrative fees, mainly charged by local governments and administrative authorities to real estate development enterprises, with numerous and unregulated projects. These include, for example, the cost of land acquisition, the cost of commodity house trading, the cost of large city support, the cost of human protection, the cost of gas and electricity increase, and the cost of development management. In short, taxes and fees account for about 25 per cent of development costs. You can count it. How many taxes

    There are also land costs, construction works, municipal public facilities, administrative costs, interest on loans, marketing costs, other costs, etc. In sum, the total cost is approximately 80 to 85 per cent, and the developer actually earns between 15 and 20 per cent. So the country and the bank are the biggest losers。

    But should we attribute all responsibility for high prices to the government? How many responsibilities do we develop

    At least i know that being blind, arrogant and impulsive is a major factor in the high cost of developers. Also, in building management, especially at the project positioning and planning stage, there is no careful research, but rather a step-by-step approach, resulting in a disorderly and arbitrary management of costs. And you're always thinking about wool coming out of the sheep。

    In fact, the market will never abandon you if we do a top-level design before development, look at each and every one of them carefully, and sell them in a way that's fair

     
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