The Zhitong Finance App learned that Zhongda Securities released a research report saying that the optimization of high-energy urban policies may support the gradual restoration of the sales side and maintain the real estate industry's “better than the market” rating. In September, industry sales continued to weaken and development investment continued to decline. This month, some high-energy cities have proposed measures such as adjusting interest rates on housing loans. At the same time, some regions have lowered the threshold for urban settlement and home purchases, which may be expected to boost the release of housing demand and drive a gradual improvement in sales.
The main views of Zhongda Securities are as follows:
Commercial housing sales continued to decline, and the cumulative year-on-year decline in residential sales increased.In January-September, the cumulative sales amount of commercial housing nationwide fell 4.6% year on year (previous 8 months: -3.2%), and the cumulative sales area fell 7.5% year on year (previous 8 months: -7.1%); among them, residential transactions declined further. In January-September, the cumulative sales amount of domestic housing sales fell 3.2% year on year (previous 8 months: -1.5%), and the cumulative sales area fell 6.3% year on year (previous 8 months: -5.5%). Recently, local demand-side policies have been improved in multiple dimensions, and implementation of high-energy urban policies has accelerated. However, due to insufficient restoration of market confidence and residents' future income expectations, the overall transaction situation is weak.
The decline in national development investment increased by 0.3 pct compared to the previous month, and the year-on-year growth rate of completion continued to increase.In terms of real estate development investment, in January-September, the total amount of real estate development investment completed fell by 9.1% year-on-year (previous 8 months: -8.8%). Recent weak sales are still the main reason for the decline in development investment. This month, the data on new housing starts and finishes improved compared to the same period last year. In January-September, the area newly started for housing decreased by 23.4% year on year (previous 8 months: -24.4%), and the area completed increased by 19.8% year on year (previous 7 months: +19.2%). As the liquidity of some housing enterprises improves and local policies advance, the commencement and completion of construction may continue to improve.
The decline in development funding sources increased by 0.6 pct, while deposits, advance payments, and personal mortgage loans declined significantly.The cumulative number of real estate development funding sources in January-September decreased by 13.5% year-on-year (January-August: -12.9%). Looking at the split, domestic loans fell 11.1% year on year (previous 8 months: -12.8%), and self-financing fell 21.8% year on year (previous 8 months: -22.9%); deposits, advance payments, and personal mortgage loans were affected by commercial housing sales. The year-on-year decline was significant, with cumulative year-on-year decreases of 9.6% and 6.9% respectively (previous 8 months: -7.3%, -4.3%). Currently, in a context where sales have not stabilized, real estate development funding sources are maintaining a downward trend, and future development capital may gradually recover as industry sales recover.
Overall sales continued to decline in the first 9 months, and the removal cycle rose further month-on-month.In September, the transaction area of new housing in 45 cities increased 9% month-on-month and 34% year-on-year; the cumulative transaction area for that year also fell 7% (August: 3% year-on-year decrease), while first-tier cities and second-tier and third-tier cities increased 3% and decreased 8% and 12% respectively. Dongguan, Maoming, Xiamen, and Weinan had large cumulative increases, while Shaoxing, Yancheng, Liuzhou, and Suzhou had large cumulative declines. By the end of September, the new housing removal cycle in 14 cities was 28.4 months, an average increase of 13% over the previous month and an increase of 86% over the previous year. In terms of second-hand housing, in September, the second-hand housing transaction area in 15 cities increased 2% month-on-month and 14% year-on-year; by the end of September, the cumulative transaction area of 15 cities had also increased by 34% (end of August: 36% year-on-year increase). Dongguan, Yangzhou, and Qingdao had the highest cumulative increase in second-hand housing transaction area. In terms of listing volume and price, the number of third-tier second-hand housing listings remained relatively high, and the first-tier listing price index remained stable. Recently, local housing purchase policies, such as “no loan approval” and cancellation of purchase restrictions and sales restrictions, have been promoted one after another, or the volume and price index of favorable second-hand housing has improved.
The growth rate of first-tier and second-tier transactions declined, and the premium rate remained stable.In January-September, the cumulative sales area of residential land in Baicheng fell by about 31.6% year-on-year, a further increase from the previous month's decline; among them, first-tier, second-tier cities fell by 42.4%, 39.2%, and 24.4% respectively. In terms of average floor prices traded in second-tier cities, the average floor price traded in second-tier cities has increased a lot, but due to the large drop in average floor prices in Tier 1 and 3, the overall average floor price traded has declined somewhat compared to last month. In terms of the premium rate, the transaction premium rate in Baicheng in September was consistent with that of the previous month.