On October 1, the author wrote: 'National Day October 1st, Grandpa Gives a Big Gift.' What big gift? Starting October 1, China will implement loan interest subsidies for residents purchasing homes, meaning Grandpa subsidizes your interest payments, capped at RMB 1 million.
The result?
JPMorgan stated that preliminary sales data from the mainland residential property market during the National Day Golden Week are encouraging.
Recently, JPMorgan published a research report indicating that preliminary sales data from the mainland residential property market during the National Day Golden Week are encouraging, with real-time second-hand transaction volumes in 26 cities rising 59% year-on-year, viewing volume in 44 cities rising 16% year-on-year, and new home subscription volumes rising 15% year-on-year.
The bank noted that the sales performance during the first week after the mortgage subsidy policy took effect on October 1 reflects an immediate nationwide response following policy implementation. The real issue lies in sustainability after one to two months. The bank generally does not get overly excited about policy-driven sales improvements, as historically such improvements are often short-lived, and it would rather see organic improvement like that seen in the second quarter of this year.
After preliminary communication with leading state-owned developers, JPMorgan received mixed feedback, with some stating 'growth is good' while others indicated the market remains 'weak.'
On the secondary market front, on October 8, Chinese property developer stocks rose 1%, while the Hang Seng Index fell 1.4%, with gains mainly driven by state-owned enterprises. China Overseas (00688) rose 4%, and China Resources Land (01109) rose 3%; most distressed developers declined, with Vanke Enterprise (02202) and Sunac (01918) both falling 6%.
JPMorgan believes this divergence shows the market rewarding short-term data improvements (state-owned enterprises outperforming) rather than betting on policy, as the policy has already been implemented, leading to profit-taking.
The bank's top picks remain China Resources Land, China Overseas, and Beike (02423).
*Optimistic but not blindly so, proceed with caution*
Foreign brokerage firms reporting positive news isn't self-promotion, but of course, reporting is still necessary.
The author recommends Vanke, Longfor (00960), and Yuexiu Property (00123).
Recent news reports vary.
On October 9, market news indicated that the China Resources Land Yunqi Binjiang project in Shanghai is currently accepting subscriptions, with a final release of units ranging from approximately 150 to 487㎡. Among them, the Phase 04 plot [Yunqi Binjiang - Bay Island] is experiencing strong sales in its 12th opening batch.
A limited number of approximately 155 to 258 square meter four-bedroom units are available in the Phase 04 plot [Yunqi Binjiang - Bay Island], with a registered average price of RMB 145,950 per square meter, starting at a total price of about RMB 20.23 million.
Previously, a limited number of units ranging from approximately 125 to 286 square meters, three to four bedrooms, are available, with a registered average price of RMB 150,848 per square meter, starting at a total price of RMB 18.63 million.
According to project disclosures, Yunqi Binjiang has opened 12 times within 10 months, accumulating sales of over RMB 2.8 billion, attracting more than 1,000 buyers.
On October 9, Yuet Tung's Yau Tong Harbourview Phase 1 received over 39,800 preliminary purchase registrations in its first round, with 200 units offered, representing an oversubscription of 198 times.
Some domestic securities firms have started turning positive on the property sector.
Huatai Securities' research report stated that by October 8, Beijing, Shanghai, Guangzhou, and Wuhan had successively released detailed housing sales reform measures.
Compared to the plans in Beijing, Shanghai, and Guangzhou, Wuhan offers more flexibility. In the future, the flexibility of details in second- and third-tier cities may generally be better than in Beijing, Shanghai, and Guangzhou, helping to buffer the impact of sales system reforms on property developers and the industry.
The research report believes that overall, the market's reaction to the sales reform has been relatively fully reflected, and the focus will shift back to the recovery process of real estate volume and prices. Dual optimization on both supply and demand sides may drive more cities' property prices to bottom out faster.
Key focus should be on developers better adapted to the new model: those outstanding in financing, product strength, construction capability, or holding and operational management; leading second-hand brokerage firms; leading Hong Kong-based property developers; and quality commercial management and property management companies.
However, investors cannot be optimistic about all domestic property stocks, because 'stock' fates differ.
On October 9, individual property stocks declined. Lujiazui (Shanghai: 600663) fell 8.7% to close at RMB 10.15 (RMB, same below), Shirong Zhaoye (Shenzhen: 002016) fell 0.8% to RMB 4.79, Zhongtian Service (Shenzhen: 002188) fell 0.7% to RMB 5.93, Shenzhen Zhenye A (Shenzhen: 000006) fell 0.5% to RMB 7.46, Huali Family (Shanghai: 600503) fell 0.4% to RMB 2.52, Nandu Property (Shanghai: 603506) fell 1.8% to RMB 12.06, Sunshine Shares (Shenzhen: 000608) fell 1.6% to RMB 6.8, Yu Hongyuan A (Shenzhen: 000573) fell 1% to RMB 3.89, ST Development (Shenzhen: 000838) fell 3.2% to RMB 2.42.
Be optimistic but not blindly so, proceed with caution, and only then can one benefit from Grandpa's big gift this time. For stocks that have risen over 30%, be cautious, cautious, cautious.
(Investing involves risk; each investor's risk tolerance varies, and independent thinking is essential. The author will buy and sell based on market conditions.)
*Articles published in
