Glonghui, January 5 | Morgan Stanley released a report saying that high interest rates and weak macroeconomics in the second half of last year caused the Hong Kong property market trend to ease. It is estimated that residential property prices will drop 10%, retail rents will rise 3%, and office rents will drop 5% this year. They prefer companies with high retail exposure over offices and residences, and also prefer net cash companies, such as Changshi Group (1113.HK) and Sino Real Estate (0083.HK), over high-debt companies. If interest rates fall faster than expected, I believe real estate trusts (REITs) and developers will benefit. Damo upgraded the credit rating from “synchronizing with the market” to “increasing holdings,” believing that the company has a better position in the downward cycle of the housing market. Its strong net cash supports higher interest income, dividend growth, and land reserve recovery. In addition, the rating of Jiulongchang Real Estate was also upgraded from “synchronizing with the market” to “increasing holdings” because the bank favors retail business. The bank adjusted target prices for some real estate stocks and used larger net asset value discounts to reflect the impact of the downturn cycle in the property market. According to Damo's expectations, Changshi and Hang Lung Properties (0101.HK)'s dividend payments per share were flat last year, and the dividend forecasts for nine units, Zhifu Real Estate Trust (0778.HK), Guanjun Industrial Trust (2778.HK), and SHKP (0016.HK) were lowered to reflect the increase in interest expenses. The bank believes that the company's dividend per share may fall because the dividend amount is calculated based on a fixed dividend ratio.