①The short-term surge in mainland real estate stocks in Hong Kong, what are the incremental highlights to look out for? ②Recently, there have been frequent instances of land auctions in the market with premium land acquisition prices. Are industry insiders bullish on the future market turning warmer?
On September 20th, after the previous day's Fed rate cut, Hong Kong stocks in the mainland real estate sector have risen for the second consecutive day, with the short-term uptrend accelerating.
As of the press time, Midea Real Est (03990.HK) rose nearly 10%, China Jinmao (00817.HK) and Sunac (01918.HK) both rose over 5%. Sino-Ocean Gp (03377.HK) and China Vanke (02202.HK) followed with gains of around 4%.
In the short term, after the Fed rate cut, the market has raised sales expectations for the real estate market in the strong season of September.
It is worth noting that despite the latest announcement that the September Loan Prime Rate (LPR) remains unchanged, failing to meet the market's expectation of following the Fed rate cut, there is still consensus within the industry for the LPR to continue to decrease this year.
Yan Yuejin, Deputy Director of the Shanghai Real Estate Research Institute, believes that there is still room for further reduction in the LPR in the future, which will help further reduce the costs of mortgages, thereby promoting the recovery and healthy development of the real estate market.
On the other hand, benefiting from the expectation of loose liquidity brought by the rate cut, the land auction market has become active again recently, with many real estate companies bidding at a premium, highlighting a recovery in industry confidence.
On September 20th, Greentown China's subsidiary Zhejiang Fan Real Estate won a residential land plot in Xiaoshan District, Hangzhou City with 1.406 billion yuan, a premium of 16.58% over the base price.
In addition, on the same day, Beike's Beihaojia (Chengdu) Real Estate won the title of "Land King" in Chengdu with a high premium rate of up to 42%, with a total price of approximately 1.076 billion yuan, and a transaction floor price of 0.0273 million yuan/square meter.
Prior to that, the land auction markets in high-energy cities such as Shanghai, Beijing, and Nanjing have also become active.
On September 12, the Shunyi Houshayu Town plot in Beijing received only one round of quotes, with Maoyuan Real Estate winning the bid at a base price of 4.32 billion yuan. Among the 11 residential land plots traded in Nanjing, only one in Jiangning District was sold at a premium, while the remaining 10 were sold at base prices, totaling 4.389 billion yuan.
On September 14, the fifth batch of residential land auctions in Shanghai closed, with only two plots reaching a transaction amount of 12.025 billion yuan. One plot in Jing'an District, located in the core urban area, went through 163 rounds of bidding, achieving a premium rate of 31.2%.
On September 19, the Shanghai land transaction market issued the sixth batch of land transfer announcements, with a total starting price of 14.77 billion yuan for four plots, likely to continue the heat in the land auction market.
Considering that in August, the enthusiasm of real estate companies for land acquisition reached a low point, the resonance effect of market expectations and industry cycle reversal is worth noting as the macroeconomy enters an interest rate reduction cycle.
According to the report by BOC International analysts Xia Yifeng and Xu Jialu on September 17, short-term investment opportunities in the real estate sector are mainly focused on market recovery and policy changes.
BOC International believes that in terms of the industry alone, housing prices are an indicator that requires particular attention at present. With clear expectations of interest rate cuts and reserve requirement ratio reductions in China, it is necessary to actively monitor incremental policies. The overall industry needs to continue to focus on the feedback of the traditional peak season for home purchases in September and October.
