Summary of Key Points from the Conference Call Industry Overview: China Property Market - **Sales Performance**: The contract sales of the top 100 developers in China declined by 37% year-over-year (YoY) in November 2025, an improvement from a 41% decline in October 2025. The decline is attributed to a lower base effect from the policy impact in September 2024 [2][24][26]. - **Sequential Decline**: On a month-over-month (MoM) basis, contract sales fell by 12%, which is worse than the historical average decline of 4% MoM from 2020 to 2024 [2][7]. - **Two-Year Comparison**: Compared to November 2023, the sales dropped by 43%, worsening from a 38% decline in October 2025 [2][24]. - **Factors Influencing Sales**: The weak sales in November are attributed to: 1. Accelerated decline in secondary property prices in tier-1 cities over the past 2-3 months. 2. A significant reduction in new project launches, down 60% YoY across 12 cities [2][3]. Market Dynamics - **Secondary Listings**: Secondary listings across 50 cities increased by 10.1% YoY as of the end of November, up from 9.3% at the end of October. In tier-1 cities, the growth remained stable at 2.1% YoY [3][10]. - **Homeowner Behavior**: The rise in secondary listings is driven by: 1. Increased mortgage and operating loan default risks prompting banks to sell properties. 2. Homeowners selling properties ahead of loan maturities [3][10]. - **Real-Time Transactions**: Recent data indicates that secondary transaction units remain lower than levels seen in 2024 and 2023, reflecting subdued market sentiment [3][14]. Developer Performance - **Market Share**: The market share of state-owned enterprises (SOE) and private-owned enterprises (POE) developers stands at 53% and 32%, respectively [4][27]. - **Sales Performance by Developer Type**: Semi-SOE developers experienced a 40% YoY decline in contract sales, underperforming both SOE and POE developers, which saw declines of 36% YoY [4][27]. - **Top Performers**: Among SOE developers, Poly Property reported a 12% growth in contract sales, while C&D International and Yuexiu saw declines of 52% and 48% YoY, respectively [4][27]. Financial Metrics - **Top 100 Developers' Sales**: The combined gross contract sales value for the top 100 developers dropped by 37% YoY in November, compared to a 41% decline in October [6][24]. - **Individual Developer Performance**: Notable sales figures for November 2025 include: - CR Land: RMB 23.0 billion, -11% YoY - COLI: RMB 22.2 billion, -26% YoY - Poly Developments: RMB 18.1 billion, -25% YoY - Vanke: RMB 9.4 billion, -55% YoY [6][24]. Inventory Levels - **High Inventory**: As of October 2025, inventory levels in tier-1 cities remain high at 22 months, with the average inventory in 80 major cities reaching a historical high of 31.2 months [17][20]. Price Trends - **Secondary Housing Prices**: The average selling price (ASP) of secondary housing in six major cities has declined by 34% from its peak [21][22]. Risks and Opportunities - **Downside Risks**: Key risks include government policies restricting demand and mortgage lending, tight financing for developers, and lower-than-expected residential growth [35]. - **Upside Opportunities**: Potential for policy loosening that could boost residential property sales and investments, as well as large-scale asset disposals by developers to ease liquidity pressures [35].

Investment Rating - The report does not explicitly state an investment rating for the industry or specific companies within it. Core Insights - Top 100 developers' contract sales weakened by 10% YoY in May 2025, slightly worsening from a 9% decline in April 2025, while MoM sales increased by 3% [2][6][19] - The decline in sales is attributed to macro uncertainties amid the trade war, impacting homebuyer confidence, particularly in export-heavy cities like Ningbo and Guangzhou [2] - Tier-1 cities continue to drive the primary market, with primary sales volume in these cities increasing by 26% on a 30-day moving average basis, compared to a mere 3% for 30 cities combined [2] - SOE developers outperformed the overall market with a 4% YoY decline in contract sales, while semi-SOE and POE developers saw declines of 22% and 15% respectively [4][23] - The luxury housing market remains active, with notable sales such as Shanghai's Kangding 19 project, which sold out 91 units in 41 minutes with a 265% oversubscription rate [2] Summary by Sections Sales Performance - In May 2025, the combined sales of the top 100 developers dropped 10% YoY, with a 3% MoM increase, reflecting ongoing market challenges [6][19] - For the first five months of 2025, combined sales declined 8% YoY, consistent with the previous month [2][19] Secondary Market Activity - Secondary listings in 50 cities increased by 8.7% YoY and 7.8% YTD, while Tier-1 cities saw a 4.3% YoY and 5.6% YTD increase [3][9] - The secondary transaction volume for 12 cities increased by 7% YoY in May, although this was a slowdown from 17% in April [3][29] Developer Performance - SOE developers maintained a market share of 53%, outperforming POE developers at 32%, with Jinmao and COLI showing significant contract sales growth of 72% and 21% YoY respectively [4][23] - The report indicates a potential shift in sales models from presale to completed properties, which may favor SOE developers due to their lower financing costs [4] Market Outlook - The report anticipates stabilization in the property market, indicated by positive land sales YoY after three years of decline and a robust luxury housing market [2]