Alibaba's new property and real estate app is set to upend the industry, experts say. Tmall Haofang, which translates to "good homes," is aiming to give developers a new online channel to consolidate their listings and give them having access to the platform's hundreds of millions of existing users.
Property developers in China have mostly been having a hard time selling their stocks this year as the pandemic forced them to close down their showrooms and exhibitions for months. Some companies have transitioned to online channels to sell their units but their individual efforts have mostly been hit or miss.
Alibaba, which owns the world's largest e-commerce platform, is hoping that the newly launched feature will support the recovery of the country's real estate industry. Major developers such as Country Garden Holdings have already started placing some of their new units on the platform. Some of the homes listed are also being offered with significant discounts to entice buyers.
"Developers are all under pressure to sell homes this year and we are hoping that Tmall Haofang can help us. E-commerce platforms will change the landscape of China's property industry," a senior executive at property management firm Sunshine City Group mentioned during an interview.
Similar to how ubiquitous online grocery shopping has become in China, Alibaba hopes that more people will get used to shopping for homes and properties on its e-commerce platform. Given that one in every two mobile phones sold in China is capable of accessing the internet, property developers can leverage that fact to reach more customers.
To entice more homebuyers onto its platform, Alibaba announced that it has prepared more than 10 billion yuan or roughly $1.46 billion to subsidies listings to let developers offer discounts for select properties. Industry experts forecast that the subsidies could ignite an all-out price war among developers, who are expected to aggressively push to attract more buyers.
The upcoming Singles' Day online shopping festival, which will take place Nov. 11, is expected to generate billions of dollars in revenue once again this year. Sellers of luxury items, groceries, electronics, and real estate are expected to offer steep discounts and promotions to entice online shoppers during the event.