Affected by the economic downturn, the national new home market is relatively sluggish. It is understood that in the first half of this year, the price of new houses in 100 cities in China rose slightly by 0.15%, and the transaction scale hit the lowest level in the same period in recent years, down more than 40% year-on-year; at the same time, the demand for fine decoration and renovation of old houses has increased. Therefore, many ceramic companies have set their sights on this market, intending to carve up a big pie with an output value of over 100 billion.
The penetration rate of fine decoration has increased
The supporting scale of ceramic tiles is 702,700 sets
Although the real estate market continues to be sluggish and the transaction volume of new homes is not as good as before, the demand for refined decoration is still mainstream. Judging from the refined decoration promotions of 50 real estate companies in 22 cities from January 2021 to June 2022, the proportion of refined decoration promotions reached more than 60%. It is not difficult to see that fine decoration has become a mainstream phenomenon in project sales.
AVC monitoring data shows that the number of ceramic tile supporting projects in the H1 fine decoration market in 2022 is 938, a year-on-year decrease of 42.3%; the supporting scale is 702,700 units, a year-on-year decrease of 49.1%. The configuration rate reaches 99.6%. In terms of brand competition, Mona Lisa ranks first with a growth rate of 2.2%. The top 2 to top 5 are Marco Polo, Guanzhu, Nobel, and Dongpeng. The overall brand concentration increased slightly, with Nobel ranking among the top 4 with a share growth of 2.8%.
It is understood that the relevant national departments guided and encouraged refined decoration of houses 10 years ago. Although the market in 2022 will not meet expectations and the market has not yet returned to pre-epidemic levels, judging from the monthly increase in the first half of the year, the scale will gradually increase. After consumer confidence recovers in the second half of the year, there will be a turnaround. The scale is expected to be between 2.2 and 2.5 million units. The fine decoration market is a general trend.
From the perspective of city performance, the fine decoration rates in Suzhou, Guangzhou, Wuxi and Hangzhou all exceed 90%, which are 96.0%, 95.6%, 90.9% and 90.0% respectively, almost reaching the point of decoration upon launch. These cities are first- and second-tier cities with relatively developed economies, and cities where fine decoration standards and requirements were promoted earlier. From a regional perspective, the Pearl River Delta's fine decoration rate reached 91%, of which Guangzhou's fine decoration rate reached 70% as early as 2007, and its development showed a trend of eliminating rough housing; the Yangtze River Delta region followed,The fine decoration rate is 82%.
Although the number of ceramic tile matching units alone is 702,700, which is impressive, the year-on-year decrease is also 49.1%, which is close to "cut in half". It can be said that although the penetration rate of fine decoration has increased, the overall market is not as good as before. Many real estate companies have experienced thunderstorms in the past, and many small and medium-sized ceramic companies have low risk tolerance and are shunned by the real estate decoration channel. As a result, the real estate decoration channel has become dominated by large ceramic companies, and brand concentration has increased.
The output value reaches 690 billion yuan!
How popular is the existing housing renovation market?
Since the beginning of 2019, “old reform” has been mentioned many times in policies issued by the state. In addition, local governments and banks have also introduced a series of policies to promote the "old reform" work. Affected by this, the stock market, including second-hand houses and renovated houses, has shown a long-term upward trend in terms of scale and growth rate, and China's real estate has fully entered the stock era.
In addition, the transaction volume of second-hand houses is also much higher than that of new houses. According to July data, the second-hand housing transaction volume index of nearly 50% of the 50 cities including Dongguan, Langfang, Beijing, Shanghai, and Tianjin has increased month-on-month, and the transaction volume index of more than 60% of the cities such as Ningbo, Taiyuan, Zhengzhou, Nanjing, and Suzhou has exceeded last year. Same period. Among them, a total of 5,038 second-hand houses were sold in Foshan in July, with an online signing area of 619,300 square meters, a month-on-month increase of 9.57%, almost the same as last year, but a new high for the year. Compared with the new home market, the second-hand home market has recovered rapidly, which has subsequently led to an upsurge in "secondary decoration".
Data from the China Decoration Association shows that the renovation output value of the existing housing renovation market reached 690 billion yuan in 2020 alone, a year-on-year increase of 15.0%, accounting for 33.8% of the total output value; the existing housing renovation market has the fastest growth rate and is further expanding. The demand for a large number of redecorations, renovations, and partial adjustments continues to bring huge increases to the home furnishing market. Data released by the China Building Materials Circulation Association shows that in the first half of 2022, the cumulative sales of building materials home stores above designated size reached 637.171 billion yuan, a year-on-year increase of 3.2.47%.
“There are currently 300 million existing houses in the country, and about half of them are in need of renovation. This market has huge space.” Qin Zhanxue, president of the China Building Materials Circulation Association, said that as the demand for improved homes continues to be released, The market share of building materials and home furnishings, dominated by the redecoration of existing houses, is also gradually increasing.
At present, a large number of old houses have reached the age of "renovation". There are 170,000 old urban communities reported to be in need of renovation from various places, involving hundreds of millions of residents. If the renovation period is five years, it is predicted that new investments of more than 800 billion yuan will be made every year.
In 2022, the country plans to start renovating 51,000 old urban communities with 8.4 million households. Among them, Qingdao City will start renovating 318 old communities in the first half of this year, with a construction area of about 8.03 million square meters and involving about 92,000 residents. ; Hubei has made it clear that 3,053 old communities will be renovated in the province in 2022; Foshan City will continue to carry out the renovation of about 110,000 old communities from 2022 to 2024. Many consumers say that the cost of renovating an old house is more affordable than buying a new one, and it can also improve the quality of life.
Ceramic tiles have always been one of the irreplaceable main materials for interior decoration, so secondary decoration generally requires the use of ceramic tiles. Among them, the renovation of second-hand houses will drive the demand for medium and large slabs and even rock slabs, while the renovation of old residential areas will , involving the renovation of housing exterior walls, public transportation and service areas, will drive the demand for functional products such as thin plates, thick bricks, healthy bricks, and anti-skid bricks. From this point of view, the existing housing renovation market will be a new competition track for ceramic enterprises.
There are many difficulties in secondary decoration
How should ceramic companies respond?
As the demand for home decoration of existing houses gradually increases, ceramic companies have begun to deploy the market for renovation of existing houses. However, compared with the new housing market, the construction difficulty of renovating old houses can be said to have increased a lot. There are many difficulties such as scattered demand, complex projects, and high technical requirements.
Whether it is demolition work before construction or the laying and use of new ceramic tiles, the living environment of the homeowner must be taken into consideration. Therefore, how to renovate old houses quickly, safely and efficiently has become a question that many ceramic companies need to think about.
Wrigley Tile has two major layouts in the renovation of old houses: First, it launches new single products that are compatible with both new decoration and "secondary decoration" needs, such as the 8mm mid-board series, which not only has high installation efficiency, but is also very cost-effective. ; The second is to carry out special assembly services for "secondary decoration". Through years of exploration in the overall transformation and the research and development of ceramic tile accessories, the overall decoration efficiency has been greatly improved.
Consumers have a large demand for secondary decoration or partial decoration upgrades. For them, issues such as the replacement time and speed of old products are factors that affect service quality. From pre-sales, sales, and after-sales of products, from products to factories to dealers, as well as the last mile of transportation, installation and commissioning, maintenance services, etc., Wrigley relies on its service information center to establish full life cycle management. Before the product leaves the factory, it is accompanied by a unique code throughout its life cycle. By scanning the code, users can promptly contact the headquarters data platform and receive timely feedback and processing. At the same time, Wrigley also has a complete service system for old modification services such as micro-installation.
Dongpeng Ceramics, on the other hand, started from the application of consumer scenarios and proposed wall slate solutions. It launched more than 60 new products in one fell swoop and proposed innovations in wall decoration materials. There is no need to shovel or scrape the wall during decoration, and it can be directly placed on the wall. Construction is carried out on rough walls or walls with wallpaper and wall coverings to avoid decoration pollution to the greatest extent and solve consumers' concerns about environmental protection. In addition, the renovation period is short, the whole house renovation only takes 3-7 days, and the partial renovation can be completed in one day. Can be completed.
Samit Tile has also launched the "48-hour wall quick modification plan" nationwide, that is, within 48 hours, 800×2600mm wall protection rock slabs will be used to complete the wall modification of specific spaces in the house. Achieve rapid housing reform without affecting daily life as much as possible.
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The gradual release of the market value of old house renovation and the huge stock base have brought large incremental space and market opportunities to the building ceramics industry. Because "secondary decoration" is more difficult, many ceramic companies dare not take a bite of this big cake. However, with the real estate industry sluggish and struggling to recover, areas such as second-hand house renovation will be a market space that the construction and ceramics industry urgently needs to explore, providing new opportunities for the development of the industry.
