The higher the property premium rate, the better?

The higher the insurance rate, the better. If the premium rate is too high, it will not be accepted by buyers, which will directly affect the sales of real estate. Therefore, in order to protect the interests, most developers will prevent the deliberate suppression of housing sales, and encourage agents to actively sell houses. They will stipulate the minimum total sales price of all houses in the housing project and control the price of each suite source within a range. Agents will generally make the house price higher than the base price through their sales promotion, and the price higher than the base price will become a premium rate.

What does the premium rate of real estate mean?

Property premium rate refers to the rate of property appreciation. As the name implies, the premium is higher than the original price, and the higher percentage indicates the premium rate. For example, developers let agents sell properties, and the average price is 10000. If the agent can buy 15000 through a series of professional means such as marketing, planning and design, the middle 5000 is a premium, and the premium rate is 5000/ 10000=50%. How to make a commission on the premium of 5000 depends on the business model of each company.

Developers will generally stipulate the minimum selling price of all the houses in the real estate, and control the low price of each suite. Selling houses through this "premium" way can effectively improve the enthusiasm of sales agents, and developers usually get higher income than expected.

What does the land premium rate mean?

Land premium refers to the land transaction difference that exceeds the land price agreed in the contract.

Land premium rate is the percentage that land price exceeds all costs. The calculation formula is land premium rate = (auction transaction price-land cost price)/land cost price * 100%.

Term decomposition: the part that exceeds the total cost and price of the original land is called premium.

The premium is higher than the original price, and the percentage of the premium is the premium rate, which is actually the increase.

Relationship between land premium rate and house price

In other words, the land premium rate is the ratio of the auction price of a piece of land to the actual highest land cost (including demolition). A premium rate of 50% means that land auction enterprises pay half of the highest cost of high land to obtain land, while a premium rate of 100% means that enterprises pay double the full price to obtain land. At present, it is certainly a loss to pay such a cost, but no enterprise will do a loss-making business.

Bottom line: When land is auctioned, the higher the land premium rate, which means that housing enterprises are more optimistic about the future property market.