Caixin on November 1st (Reporter: Li Jie) Affected by policy bullishness and property developers' promotions, the sales of the top 100 property developers in October achieved positive year-on-year growth for the first time this year.

Ping An Securities' research report shows that in October, the top 100 property developers achieved sales of 465.4 billion yuan for the month, an increase of 70.1% month-on-month and 4.9% year-on-year; they achieved sales area of 23.22 million square meters, an increase of 52.1% month-on-month and 6.2% year-on-year.

"In October, the monthly sales amount of the top 100 property developers turned positive year-on-year for the first time this year, with the month-on-month growth rate also being the second highest of the year, second only to March this year," said Analyst Chen Shen from HTSC.

Specifically, according to statistics from HTSC, among the top 100 property developers, in October, 83 property developers achieved positive month-on-month growth in sales, an increase of 33 compared to September; 38 property developers achieved positive year-on-year sales growth, an increase of 22 compared to September.

Among them, the performance of central state-owned enterprises in sales has significantly improved, with an increase in the number of central state-owned enterprises with positive growth. Among the top 100 property developers, the year-on-year sales growth rates of central state-owned enterprises and private enterprises in October were +23.1% and -12.2% respectively, increasing by 62.0 and 26.4 percentage points compared to September.

Among mainstream property developers, in October, the sales growth rates of China Fortune Land Development, Yuexiu Property, Jianfa Property, Zhuhai Huafa Properties, and Poly Developments and Holdings Group led the way, with year-on-year growth rates of 65.8%, 48.1%, 43.9%, 30.2%, and 27.8% respectively.

"Currently, market confidence is stronger than in the first month after the May 17th policy. With the further 25BP decrease in LPR and the expected continuation of the downward trend in mortgage rates," Chen Shen believes that under the support of the new policy, the real estate market is expected to see further recovery.

Benefiting from the warming up of the sales end in October, the sales performance of the top 100 real estate companies in the first ten months has narrowed compared to the first nine months.

According to Ping An Securities' research report, the cumulative sales of the top 100 real estate companies from January to October reached 3.3 trillion yuan, with a total sales area of 0.18 billion square meters, a year-on-year decrease of 34.8% and 36.3% respectively, with the decline narrowing by 3.8 and 3.5 percentage points compared to January to September.

Among them, 4 of the top 50 real estate companies achieved year-on-year sales growth from January to October, one more than in January to September. These 4 companies are Wuhan Construction Group, Shui On Land, Bangtai Group, and Poly Developments and Holdings Group, with year-on-year growth rates of 146.1%, 82.5%, 10.5%, and 0.2% respectively.

Among the top 100 real estate companies, only 7 companies with cumulative sales exceeding one trillion yuan remained in January to September, a decrease of 7 compared to the same period last year; while 73 companies with sales exceeding one hundred billion yuan decreased by 27 compared to the same period last year.

Poly Developments and Holdings Group ranked first in the industry in the first ten months of this year with sales of 284 billion yuan, followed closely by China Overseas Land & Investment Ltd. with 240.4 billion yuan. Greentown China ranked third in the industry with 214.93 billion yuan, China Resources Land rose to fourth place in the industry with sales of 203.3 billion yuan, and Vanke dropped to fifth place in the industry with sales of 201.71 billion yuan.

The sixth to tenth places in the industry are China Merchants Shekou Industrial Zone Holdings, Jianfa Property, Hangzhou Binjiang Real Estate Group, Yuexiu Property, and Longfor Group, with sales of 167.44 billion yuan, 103.97 billion yuan, 92.16 billion yuan, 91.2 billion yuan, and 84.9 billion yuan respectively.

In terms of land acquisitions, the national land market continued to run at a low temperature in October, with a continuous decrease in land supply and demand. Land acquisition enterprises are still concentrated in central and local state-owned enterprises. According to the China Index Research Institute, from January to October 2024, the total land acquisition amount of the top 100 enterprises was 619.87 billion yuan, a year-on-year decrease of 38.7%, expanding by 0.6 percentage points compared to January to September.

In terms of new value-added goods, Poly Developments and Holdings Group, China Resources Land, and Greentown China ranked top three. From January to October 2024, Poly Developments and Holdings Group led the list with 86.6 billion yuan of new value-added goods, China Resources Land ranked second with 80.6 billion yuan of new value-added goods, and Greentown China had a new value-added goods scale of 77.9 billion yuan, ranking third.

"In the short term, the land auction environment continues to be loose, with the government adopting a more market-oriented approach in land supply and auction policy adjustments. However, constrained by the market being at the bottom stage, property developers' investments will still be driven by sales and regular savings plan. In the future, if the market sales can gradually stabilize and rise under policy stimulation, it may drive up the enthusiasm for property developers' investments." Analysts from China Real Estate Index Institute said.

In fact, since September, the combination of financial measures and the political bureau meetings have injected a strong stimulant for stabilizing the real estate market. Following the optimization of policies in first-tier cities, the down payment ratio for residents to buy houses and mortgage rates have reached historical lows, with purchase restrictions also being at the most lenient stage since implementation.

"Currently, the cost of residential home purchases has significantly decreased from the peak, starting to meet some of the conditions for the real estate market to stabilize and recover. In the future, it is still necessary to lower interest rates and housing loan rates to increase the attractiveness of rent-to-sale ratio, while expediting the implementation of land acquisition and optimization of existing inventory." Analyst Yang Kan from Ping An Securities said.