According to the Zhito Finance APP, China Galaxy Securities issued a Research Report stating that from January to November 2024, the cumulative sales area and sales amount have seen a decrease in their year-on-year decline compared to last month, with a positive growth in sales area for the month of November. Since late September, various departments have implemented supportive policies related to the demand side, supply side, and land market, and the effects of these policies may gradually become apparent. China Galaxy Securities believes that under the strong support of policies and the low base effect from last year, the impacts of these policies may gradually manifest; leading real estate companies are demonstrating excellent operational management capabilities with financial advantages, and their market share is expected to further increase.

In terms of individual stocks, China Galaxy Securities is Bullish on Poly Developments and Holdings Group (600048.SH), China Merchants Shekou Industrial Zone Holdings (001979.SZ), LONGFOR GROUP (00960), etc.; it is recommended to pay attention to: 1) Quality Development: CHINA RES LAND (01109), etc.; 2) Quality Property Management: CHINA RES MIXC (01209); 3) Quality Commercial: Shanghai Zhangjiang Hi-Tech Park Development (600895.SH), etc.; 4) Leading Construction Agency: GREENTOWN MGMT (09979); 5) Leading Intermediary: KE Holdings-W (02423), etc.

中国银河证券主要观点如下：

Sales: Monthly year-on-year growth rate turned positive. From January to November 2024, the nationwide sales area of commercial housing was 861.18 million square meters, down 14.30% year-on-year, with a narrower decline of 1.5 percentage points compared to the previous month; the sales area of commercial housing in November was 81.8784 million square meters, up 3.20% year-on-year, and up 7.08% month-on-month. From January to November 2024, the national sales amount of commercial housing was 8512.5 billion yuan, down 19.20% year-on-year, with a narrower decline of 1.7 percentage points compared to the previous month; the sales amount in November was 827.01 billion yuan, up 0.97% year-on-year and up 3.70% month-on-month. The corresponding average sales price from January to November was 9885 yuan/square meter, down 5.72% year-on-year, and up 0.23% month-on-month; the average sales price for November was 10100 yuan/square meter, down 2.16% year-on-year and down 3.16% month-on-month. Since the end of September, various support policies for the real estate industry regarding demand and supply have been introduced successively from a top-down approach. In November, the Ministry of Finance further supported the demand side of the housing market by reducing taxes. From the performance of the housing market, the sales area and sales amount achieved positive year-on-year growth for the first time in November this year, and it is believed that the stimulus effect is expected to continue.

Investment: Monthly completion rate improved month-on-month. From January to November 2024, real estate development investment was 9363.4 billion yuan, down 10.40% year-on-year, with a slight widening of the decline by 0.1 percentage points compared to the previous month. In November, the monthly development investment was 732.515 billion yuan, down 11.56% year-on-year and down 3.98% month-on-month. With the end of the year approaching, the overall investment willingness of real estate enterprises is low. As for new starts: from January to November 2024, the newly started area was 673.08 million square meters, down 23.00% year-on-year, with an expanded decline of 0.4 percentage points compared to the previous month. In November, the newly started area was 60.8107 million square meters, down 26.81% year-on-year, and up 17.48% month-on-month. The relatively small amount of land acquired by real estate enterprises in the early stages affects the scale of new starts. Regarding completions: from January to November 2024, the completion area was 481.52 million square meters, down 26.20% year-on-year, with a widening decline of 2.3 percentage points compared to the previous month. In November, the monthly completion was 61.5685 million square meters, down 38.81% year-on-year, and up 18.87% month-on-month. The relatively high completion level last year has impacted the year-on-year decline; however, there may be an increase in monthly completions.

Funding: Monthly year-on-year growth of funds related to sales turned positive. From January to November 2024, the funds available to real estate enterprises amounted to 9657.5 billion yuan, down 18.00% year-on-year, with a narrower decline of 1.2 percentage points compared to the previous month. Among them, from January to November, domestic loans totaled 1347.6 billion yuan, down 6.20% year-on-year; self-raised funds were 3467.6 billion yuan, down 11.00%; deposits and advance payments were 2962.4 billion yuan, down 25.20%; and personal mortgage loans were 1391.1 billion yuan, down 30.40% year-on-year. In November, among the sources of funds for real estate development, the year-on-year decrease in domestic loans was 3.83% monthly; while the deposits and prepayments related to sales increased by 4.99% monthly, achieving positive year-on-year growth for the first time this year, which is related to the gradual recovery of overall sales performance. As policies targeting the financing side and enterprises have been introduced since late September, it is believed that the pressure on corporate financing may gradually ease.

Investment Suggestions

From January to November 2024, the cumulative sales area and sales amount both saw a year-on-year decline narrowing compared to the previous month, and the sales area in November experienced positive year-on-year growth. Since late September, various departments have introduced supportive policies regarding the demand side, supply side, and land market, with policy effects expected to gradually emerge. It is believed that under strong policy support and the effect of a low base from last year, the effects of these policies are likely starting to show; leading real estate companies showcasing excellent Operation management capabilities and having a capital advantage are expected to further increase their market share. The following are seen as bullish: Poly Developments and Holdings Group, China Merchants Shekou Industrial Zone Holdings, LONGFOR GROUP, Hangzhou Binjiang Real Estate Group, China Vanke Co.,Ltd., Seazen Holdings, and China Merchants Property Operation & Service; recommendations for attention include: 1) Quality Developers: CHINA RES LAND, CHINA OVERSEAS, GREENTOWN CHINA; 2) Quality Property Management: CHINA RES MIXC; 3) Quality Commercial: Shanghai Zhangjiang Hi-Tech Park Development, HANG LUNG PPT; 4) Leading Construction Agents: GREENTOWN MGMT; 5) Leading Intermediaries: KE Holdings-W, 5i5j Holding Group.