[Brokerage Focus] China's real estate sector may face downward pressure from July to August, according to CMB International.
Jin Wu News | CMB International stated that Guangzhou has further relaxed regulations allowing foreigners to purchase homes; The land auction market has become hot after canceling the price limit in high-energy-level cities, while low-energy-level cities are relatively weak, indicating that the market-oriented bidding mechanism will accelerate the balance of supply and demand. High-frequency data shows that the sales of new homes have fallen slightly since the peak in late June, while second-hand homes remain strong. From early July to now, the daily average transactions of new homes/second-hand homes have decreased by 21%/increased by 11% respectively compared to the daily averages in June. In terms of transaction observation in first-tier cities, the weekly transaction volume of new and second-hand homes in the 27th week has declined compared with the previous week. Compared with the weekly average transaction volume in the year, Shenzhen and Guangzhou have performed relatively stable.
GF Sec: Land Activation Fund Established, New Home Sales Turn Positive year-on-year in early July.
GF sec released research reports stating that the state-owned assets supervision and administration commission has set up a special fund for land consolidation with a total size of 30 billion yuan and requires central SOEs to report pilot projects to try to solve the problem of long-term high inventory in the real estate market. On the local policy side, this week still mainly focuses on relaxing housing provident fund policies and providing housing subsidies to boost demand, and various regions are still exploring new policies to stimulate demand.
[Brokerage Focus] Zhongyin International is optimistic about the real estate and property management sectors, pointing out that the stock prices in the sectors will maintain a repairing trend in the medium to long term.
Jingu Financial News | Zhongyin International said it is optimistic about the real estate and property management sectors. The bank sees Beijing lowering the down payment ratio by 10-15 percentage points and lowering the housing loan interest rate by 30-55 basis points. Consistent with the bank's previous expectations, the minimum down payment ratio and housing loan interest rate restrictions in Beijing have been lowered to the same level as Shanghai and Shenzhen. As for the purchase restriction policy, according to the bank's policy relaxation timetable, there is still some room for Beijing, Shenzhen and Shanghai. As of June 26th, looking at the average daily transaction area before and after the 517 new policy, the new house market in 30 cities and the second-hand house market in 17 cities have both increased by 25%, which may be stimulated by the new policy, and the concentration of the end of the half year on the internet.
htsc: The land market supply and demand continues to be weak, focusing on real estate companies with core urban resources.
The land market is still weakly running in the first half of 2024, and the trend of shrinking volume continues, while the previously maintained rising transaction average price also decreased year-on-year in the first half of the year.
Mainland real estate stocks fell across the board. Agile Group (03383) fell by 3.47%. From today on, personal mortgage loans for housing projects with a capped main structure will be strictly implemented.
Inside the mainland real estate sector, the decline continued. As of press time, Agile Group (03383) fell by 3.47%, CIFI Hold GP (00884) fell by 3.03%, China RES Land (01109) fell by 1.79%, Sunac (01918) and China Vanke (02202) followed suit. In terms of news, it has been reported that several commercial banks in Shenzhen have required that personal housing mortgage loans can only be lent after the main structure has been capped. In other words, banks will only issue personal housing mortgage loans for housing projects in which the main structure has already been topped off. The relevant regulations will be formally implemented from the 5th. Bank of China.
Major bank rating | CICC International Securities: High-quality state-owned real estate companies in mainland China resume growth in June, preferring China Overseas, Greentown China, and Poly Developments and Holdings Group.
According to a report by China International Capital Corporation, high-quality state-owned real estate developers in mainland China have resumed growth in June, with significant improvement in contract sales of major developers, averaging a 20% monthly increase. The improvement reflects seasonal factors and basic improvement. Poly Developments and Holdings Group, China Overseas Land & Investment, China Resources Land, China Merchants Shekou Industrial Zone Holdings, Greentown China, Agile International Holdings, Yuexiu Property and China Fortune Land Development Co Ltd all ended their downward trend in the past twelve months, with China Overseas Land & Investment recording a 40% year-on-year increase in contract sales in June. The data shows that both the first-hand and second-hand markets have improved, and the adjustment of housing prices has supported market recovery. The reduction in land supply has enabled the market to balance, and it is believed that the medium-term recovery is supported by improvement
WisePort stock analysis | Fiscal and tax reforms stimulate consumer enthusiasm, China Tourism Group Duty Free Corporation (01880) skyrockets with high volume.
The impact of this national fiscal and taxation reform on the capital markets is quite significant, and more importantly, it has rekindled expectations on the consumer level. This is a gradual process, and the specific implementation time may be relatively long, but it does not hinder funds from speculating in advance.
HTSC: Stabilization of housing prices in Beijing and Shanghai sends bullish signals and is expected to accelerate the recovery of the real estate market.
HTSC stated that several volume and price indicators in first-tier cities have shown improvement compared to the previous period. In particular, the cessation of the decline in housing prices in Beijing and Shanghai has conveyed bullish signals, and it is expected to accelerate the expectation of real estate market recovery. It is still necessary to continue to monitor the sustainability of the recovery of volume and price in core cities.
Guosen Securities: Real estate stocks still have game opportunities, maintaining the judgment of the market's "top and bottom".
Guosen Securities believes that the real estate sector has experienced a significant pullback and has squeezed out previous high expectations.
[Brokerage Focus] Citic Sec: Mainland real estate sales increase significantly, but most places still need further policy support.
CITIC Securities stated that real estate sales in mainland China have surged recently. According to statistics from Ke Holdings' mobile app, there were 84,000 second-hand housing transactions in 77 sample cities tracked by the bank in June, which was the same as in May. The month of June saw week-on-week declines of 8.4%, 7.7%, 2.7%, and 3.6%, respectively. As for online signing data, based on Wind data, 14 sample cities saw a YoY increase of 6.4% in online signing of second-hand houses in June, marking the first YoY growth since February. However, there was a slight MoM decrease of 5.6%. Among them, Peking, Shenzhen, and Hangzhou saw YoY increases of 23.0%, 65.5%, and 117% in online signing of second-hand houses in June, respectively.
Major bank rating | UBS Group: The sales of the top 100 real estate companies slightly rebounded in June, and it is expected that the performance of state-owned real estate companies will continue to outperform private real estate companies.
UBS Group released a research report citing data from CRIC indicating that the top 100 real estate developers in mainland China saw a 22% YoY decline in sales in June, compared to a 35% decline in May. The decline narrowed, while the MoM growth was 33%, also slightly higher compared to the average growth rate of 29% in June over the past five years. Among the top ten real estate companies, seven recorded YoY growth in sales in June, believed to be due to a lower base last year and the new salable resources brought by new land reserves in the first half of this year. In the first six months of this year, the total sales of the top 100 real estate companies fell 42% YoY, while in the first five months, it fell by 46%, with the decline narrowing. UBS believes that
Chinese Property Share Prices Likely Volatile Ahead of Third Plenum -- Market Talk
Chinese property share prices will likely be volatile ahead of the mid-July third plenary session as investors speculate about further policy stimulus for the sector, Daiwa analyst William Wu says in a research note.
htsc: There are signs of real estate sales recovery after the new policy.
HTSC stated that since 517, there have been signs of real estate sales recovery.
Ke Rui: In the first half of the year, the total amount of land acquired by the top 100 real estate companies decreased by 40% year-on-year, which is the largest decline since 2023.
Overall, in the first six months, corporate investment has continued to shrink. The total amount of land acquired by the top 100 investors in the first half of the year decreased by 40% year-on-year, the largest decline since 2023.
According to Zhongzhi Research Institute, the total sales amount of the top 100 real estate developers in the first half of the year was RMB 2083.47 billion, a year-on-year decrease of 41.6%.
China Real Estate Research Institute released the sales performance ranking of Chinese real estate companies in the first half of 2024.
Longfor paid off RMB 7.1 billion in one go.
Towards warmth.
Daiwa: Beijing increases housing loan easing efforts, industry's top choices are China Resources Land and Yuexiu Property.
Daiwa released a research report stating that the market has long expected further relaxation of real estate policies, believing that related bullish factors have been reflected in stock prices. However, in the near term, with the upcoming Third Plenary Session of the 19th CPC Central Committee, the market may have a new round of policy-oriented trade. Therefore, there may be opportunities to enter the market in the near term, emphasizing that state-owned real estate companies are still the best long-term investment targets and continuing to list China Res Land (01109) and Yuexiu Property (00123) as industry first choices, with target prices of HKD 36.1 and HKD 9.95, respectively, with both rated as "buy". According to the report, the Beijing Municipal Housing and Urban-Rural Development Commission and other departments jointly issued a statement yesterday (June 26).
[Brokerage Focus] CITIC Securities: Mainland real estate market wants to enter a virtuous cycle and cannot leave the push of fiscal and tax policies.
CITIC Securities believes that in order for the real estate market in mainland China to enter a positive cycle, it cannot do without the active implementation of fiscal and tax policies. There is a lot of room to reduce the burden of corporate income tax and land value-added tax for companies that are highly related to the profitability of their projects. In addition, some regions also have the ability to take the lead in breaking the negative cycle of declining asset prices and restoring government fund income. Currently, there are signs of stabilization in the second-hand housing prices in Shanghai, but the overall market recovery still faces many challenges. The bank is bullish on leading developers and operation service companies with high safety margins and recommends China Res Land (01109), Midea Real Estate (03990), and China Res MixC (01209).
Hong Kong stock concept tracking | Multiple bullish news in the real estate industry, the industry cycle turning point is expected to significantly strengthen the confidence (attached with related concept stocks).
Zhifubao Finance learnt that on June 25th, the real estate industry ushered in multiple catalysts. China Overseas Securities stated that the current real estate policy is being enforced with a strength exceeding the intensity of previous cycles. The overall demand is correspondingly stabilizing in phases, and the market's confidence that the turning point of the real estate cycle will arrive is significantly increasing. Currently, the market is in a stage of playing games with continued policy enforcement, while waiting for basic fundamentals to stabilize in certain local regions. During this stage, medium to short-term trading opportunities may occur frequently, and investors should act opportunistically. Related concept stocks: Greentown China (03900), China Resources Land (01109), Yuexiu Property (00123), China Resources Mixc (0)
Mainland real estate stocks rose, Midea Real Est (03990) rose 6.75%, Zhongtai Securities expects future industry data to explore bottoming-out and stabilizing with the introduction of policies.
Jingu Financial News | Mainland real estate stocks rose, Midea Real Est (03990) rose 6.75%, China Res Land (01109) rose 2.25%, Yuexiu Property (00123) rose 2.25%, R&F Properties (02777) rose 2.17%, Longfor Group (00960) rose 1.97%, and China Overseas (00688) rose 1.96%. In terms of news, last week, the inventory area of new houses in 12 cities was 69.55 million square meters, a month-on-month increase of 0.2% and a year-on-year decrease of -2.2%. The turnover period is 20.6 months, up 1 month month-on-month, and up 6 months year-on-year.
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