Line loss in residential transformer zones is mainly caused by the imbalance of the three-phase loads. However, due to the difference of the three-phase line lengths in the building, the minimum-line-loss state does not necessarily correspond to the most load-balanced state at the incoming point of the building. So, traditional commutation strategies which aim at the balance of the incoming line loads are of limited loss-reduction effects. Under the HPLC metering environment, user phases and floor line impedances can be concluded. This makes it possible to carry out user commutation in a building directly with the objective of minimizing the line loss in the residential transformer zone. In this paper, low-voltage distribution network of a residential transformer zone is divided into two parts: an inner building part and a community part. First, user commutation strategy in the building is optimized with the objective of minimizing floor line losses and commutation times. Second, building commutation strategy is constructed to further minimize the line losses and commutation times in the community part. Case study towards a residential area in Shanghai shows that the proposed commutation strategy can reduce the distribution network loss by 17.2%, which is 10.83 percentage points lower than the way of only improving the balance of the three-phase incoming loads of the buildings.