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In the cost structure of real estate development, land and construction costs are the largest proportion。
Land cost: usd 3090/m2
These costs include the purchase of land, expropriation of land, compensation for demolition and related procedures. Land prices are higher in the current land market, so land costs are usually larger than total costs. For example, if the land price is $4 million/acre, with a volume rate of 2. 0, the cost of land per square metre is $3090, or 40 per cent of the total cost. For every 1 million additional acres, the cost is approximately $770/m2。
Construction costs: $2,000/m2
Construction costs, including construction and equipment installation, are an essential part of real estate development. Construction costs may vary from building type to area. For example, construction costs for high-rise buildings are usually high at $2,000/m2, or 26 per cent of the total cost。
In addition to land and construction costs, other costs of real estate development are essential, including:
3. Supplementary costs: $400/m2
The cost of construction of municipal support facilities, such as water, electricity, gas and communications, is generally charged at a rate of $400 per square metre。
4 administrative services costs: $500/m2
These refer to various taxes and administrative fees charged by the government sector, such as urban infrastructure packages, education surcharges, etc. 6 per cent of total cost。
Land use tax: $220/m2
Land use tax is levied on land users on the basis of a certain amount per square metre per year。
9 yuan/m2*50/2. 0=220/m2, or 3% of total cost。
6 tax: $880/m2
Taxes, including vat, turnover tax and maintenance tax for urban construction, are an important cost in real estate development。
The sale price (at $8,000)* 11% = $880/m2, or 12% of the total cost。
7 marketing costs: $200/m2
Costs include advertising, sales agents, etc., which are mainly used to promote real estate projects。
The sales price (at $8,000)* 2. 5 per cent = $200/m2, or 3 per cent of the total cost。
Financial costs: $320/m2
Costs, including interest on loans, fees, etc., are an unavoidable cost in real estate development。
Item (2-5, 6, 8)*10 per cent = $320/m2, or 4 per cent of total cost。
9. Unforeseen expenses: $100/m2
This refers to unknown costs that may have been incurred in the development process, such as compensation for engineering accidents. $100/m2, 1 per cent of total cost。
Taken together, land and construction costs are the largest source of costs in real estate development, but other costs are also essential. In the development process, costs need to be properly controlled to ensure the profitability and sustainable development of the project. Overall, land and construction costs are a major part of development costs, accounting for 66 per cent of total costs. This is an important factor for real estate developers to consider, especially in developing project budgets and cost-control strategies, which require special attention to both inputs。
