Morgan Stanley published a research report stating that the Ministry of Finance introduced a series of measures related to housing tax relief yesterday (13th) to reduce the transaction costs for both buyers and sellers. The measures are generally in line with market expectations and may provide slight assistance to real estate sales in the short term. The institution believes that while the measures may reduce costs for both buyers and sellers, they still fail to change residents' cautious view on housing prices. Along with a reduction in residents' willingness to increase leverage, the institution believes that the aforementioned tax benefits may slightly assist domestic property sales but are unlikely to support a sustained recovery.

Morgan Stanley proposed that developers are almost unable to benefit from the policies, as most projects have a gross margin only in the low teens. China Overseas Land (00688.HK) and Yuexiu Property (00123.HK) may benefit relatively more, while it is believed that second-hand housing agencies in first-tier cities may be the main beneficiaries of the increased demand for housing upgrades.