Source: Broker China
Real estate companies' sales improved in March.
According to the latest data from the Kerry Research Center, the top 100 real estate companies achieved sales transaction amounts of 358.32 billion yuan in March, an increase of 92.8% over the previous month and a decrease of 45.8% over the previous year. Among them, over 80% of the top 100 housing enterprises achieved month-on-month performance growth in a single month.
Industry insiders believe that although the monthly sales performance of the top 100 real estate companies doubled month-on-month, the absolute scale is still at a historically low level. It is expected that the overall volume of property market transactions in April may continue to show a weak recovery trend. Core Tier 1 and 2 cities may experience a spotty recovery under favorable policies, and the volume of transactions in third- and fourth-tier cities will continue to bottom out.
Sales performance doubled month-on-month in March
According to data from the Kerry Research Center, in March, the top 100 housing enterprises achieved sales transaction amount of 358.32 billion yuan, an increase of 92.8% over February, but the monthly performance scale remained at a historically low level, down 45.8% from March last year. In terms of cumulative performance, the top 100 housing enterprises achieved sales transactions of 779.24 billion yuan from January to March, a year-on-year decrease of 47.5%.
As for the reason for the month-on-month increase in sales performance in March, the Kerry Research Center believes that it is due to the high base in March last year (the highest in a single month in 2023) and the low base in February this year (a new monthly low since 2019). Despite significant month-on-month growth, it still falls short of the monthly average for the third and fourth quarters of last year.
The Kerry Research Center further pointed out that in March, more than 80% of the top 100 housing enterprises achieved a month-on-month increase in monthly performance, but the housing enterprises whose monthly and cumulative performance declined year-on-year also accounted for nearly 90%. The number of companies whose monthly performance dropped by more than 50% year on year reached 52, and overall performance showed a general downward trend year over year. From January to March, there were only 16 housing enterprises with a total transaction amount exceeding 10 billion dollars in the top 100 housing enterprises, compared to 34 in the same period in 2023 and 40 in the same period in 2022. Even with full-caliber sales, there are only 20 housing enterprises over 10 billion dollars.
It is worth noting that in March, Zhonghai Real Estate achieved full-caliber sales of 41.21 billion yuan in a single month, ranking first among the top 100 in monthly sales, a record high in nearly a year. The Kerui Research Center pointed out that it was mainly due to the price inversion of the Zhonghai-Shunchang Jiuli project on the Xintian floor block in Shanghai, which contributed 19.65 billion yuan on the day of opening on March 28, and set a new record for the highest sales in a single commercial housing opening in the country.
The scale of property market transactions in April may continue to weakly recover
Regarding the current real estate market, the Kerry Research Center believes that since this year, although policy aspects have continued to be optimized, and favorable policies have been released, and regulatory policies have been loosened in first-tier and some strong second-tier core cities, market confidence support is insufficient, demand and purchasing power are sluggish, and industry expectations have not been significantly repaired.
The China Index Research Institute further pointed out that since March, the central government and supervisory authorities have continued to send positive signals to stabilize the market. The “Report on the Work of the Government” of the two sessions clearly proposed “optimizing real estate policies,” and the National Standing Committee proposed “further optimizing real estate policies.” Local policies have been continuously optimized and adjusted; Hangzhou has completely lifted restrictions on second-hand housing purchases; Shanghai and Shenzhen have adjusted and optimized the “70/90” policy to provide conditions for the supply of high-quality projects; Guangzhou plans to optimize pre-sale conditions to help housing enterprises speed up the pace of sales; and Foshan, Suzhou, Guiyang and other places have further optimized their provident fund loan policies. Since March, property market activity has increased in some core cities, driven by policy optimization, but overall, “Xiaoyangchun” in March was not successful enough, and the overall market pace may be delayed.
Looking ahead to the future market, the Kerry Research Center believes that in the short to medium term, the overall direction of the market is unclear, and there are still various uncertainties in the business environment. It is expected that the overall volume of property market transactions in April may continue to show a weak recovery trend. The absolute volume will remain the same as in March or increase slightly. However, based on last year's high base, the year-on-year decline will continue. Core Tier 1 and 2 cities may experience a spotty recovery under favorable policies. The volume of transactions in third- and fourth-tier cities will continue to bottom out, making it difficult for the scale of property market transactions to show significant results.
The China Index Research Institute, on the other hand, believes that in the short term, as policies on both sides of real estate supply and demand continue to be optimized and adjusted, buyers' will to buy homes may be moderately restored, and financing support for superimposed “white list” projects will continue to be implemented. The promotion of project construction will also help boost market confidence, which in turn will drive a marginal improvement in new home sales.
Regarding how housing enterprises should respond, the Kerry Research Center suggests that with the superposition of various favorable policies, policy effects may be evident to a certain extent. Market demand may usher in a partial structural release, and housing enterprises still need to actively promote and eliminate marketing. At the same time, it is also necessary to seize structural opportunities, explore the structural needs of different cities and groups of buyers, and cater to changes in home buying preferences through product innovation and upgrading, so as to gain an advantageous position in the market and overcome this round of crisis safely.
editor/tolk