Core Viewpoint - The trend of stabilizing the real estate market is expected to continue, with signs of recovery in major cities and marginal improvements in second and third-tier cities [5][7]. Summary by Sections Real Estate Market Performance - In July, the price decline of new homes in first-tier cities narrowed, with a month-on-month decrease of 0.2%, a reduction of 0.1 percentage points from the previous month [3]. - Second and third-tier cities saw a month-on-month decline of 0.4% and 0.3% in new home prices, respectively, with the decline in second-tier cities expanding by 0.2 percentage points [3]. - The second-hand housing market in first-tier cities experienced a month-on-month decline of 1.0%, which is an increase in the decline by 0.3 percentage points compared to the previous month [3]. Year-on-Year Price Changes - Year-on-year, new home prices in first-tier cities fell by 1.1%, with Shanghai showing a significant increase of 6.1% [4]. - The number of cities with year-on-year price increases for new homes rose to five, with Shanghai leading the way [4]. Market Insights and Expert Opinions - Analysts indicate that July and August are typically off-peak months for the real estate market, and the market is still in an adjustment phase [6]. - The differentiation among cities is becoming more pronounced, with first-tier cities showing signs of stabilization in new home prices, while second and third-tier cities are beginning to show marginal improvements in the second-hand market [6]. - The ongoing supply-side reforms are expected to shift focus towards affordable housing and urban renewal, which could support the stabilization of new home prices [7][8]. Future Outlook - Experts believe that the trend of stabilizing prices will continue, supported by factors such as improved housing policies and the increasing proportion of second-hand home transactions [7][8]. - The potential for housing demand remains strong, particularly among new urban residents and young people, as lower prices make home ownership more accessible [8].

Core Viewpoint - The current real estate market is at a critical juncture, with uncertainty about how much prices will drop before stabilizing, which is a key goal for 2025 [1][3] Market Adjustment - The real estate market is still in an adjustment phase, with predictions of a 10%-20% potential decline in national housing prices and an adjustment period lasting 1-3 years [3] - The adjustment may vary significantly by region, with first-tier cities remaining relatively stable while third and fourth-tier cities face higher risks of price declines [3] Factors Influencing Prices - Various factors, including declining birth rates and an aging population, contribute to a decrease in demand for housing, leading to an oversupply situation [3] - The current policies have reduced speculative buying, which previously supported high housing prices [3] Economic Implications - A significant drop in housing prices could disproportionately affect low- to middle-income families, for whom real estate constitutes 60%-70% of their wealth, while high-income families are less impacted [7][8] - The importance of stabilizing housing prices is emphasized due to its impact on multiple industries and employment [5][7] Policy Actions - Recent government actions have focused on promoting a stable and healthy real estate market, with a call for more targeted and effective policies to stabilize expectations and activate demand [8][9] - The necessity of synchronizing the recovery of the economy with the stabilization of the real estate market is highlighted, as both are interdependent [9][11]

Investment Rating - The report indicates a weak investment sentiment in the real estate sector, but new home sales data shows signs of bottoming out and recovery [7] Core Insights - The real estate market is experiencing a bottoming phase, with new home sales showing a week-on-week increase of 16% and a year-on-year increase of 9% in 47 cities [4][50] - The land market has seen a decline in activity, with a total of 493,000 square meters of residential land sold in the week of May 17-23, representing a 6% week-on-week increase but a 34% year-on-year decrease [44] - Special bonds for land acquisition have accelerated, with over 350 billion yuan allocated for the purchase of idle land across nearly 3,000 plots [5][14] Summary by Sections Real Estate Market Overview - The A-share real estate sector declined by 1.5% this week, ranking 23rd among all sectors, while the Hong Kong real estate sector fell by 0.7%, ranking 11th [30] - The property service and management index in Hong Kong decreased by 1.8%, while the Hang Seng China Enterprises Index increased by 1.4% [38] New Home Sales - In the week of May 17-23, new home sales totaled 404,000 square meters, with a 16% increase from the previous week and a 9% increase year-on-year [4][50] - Sales in first-tier cities saw a slight increase of 1% week-on-week but a decrease of 1% year-on-year [50] Second-Hand Home Sales - Second-hand home transactions totaled 284,000 square meters, with a 4% week-on-week increase and a 10% year-on-year increase [58] - First-tier cities experienced a 2% decrease week-on-week but a 25% increase year-on-year [58] Land Market Activity - The total area of residential land sold in 300 cities reached 131.98 million square meters year-to-date, with a year-on-year decrease of 1.5% [44] - The average premium rate for land sales was 13% during the week [44] Investment Recommendations - Developers are advised to focus on first-tier and core second-tier cities, emphasizing improved products and maintaining land acquisition capabilities [7] - Real estate agencies with strong competitive advantages, such as Beike, are recommended due to increasing market activity [7]

Core Insights - The data from the National Bureau of Statistics indicates a "stop falling and stabilize" trend in the housing market, with both new and second-hand housing prices fluctuating within 1% in March 2025 [1] New Housing Market - Among the 70 large and medium-sized cities, 29 cities saw new housing prices either increase or remain stable compared to February, with Shanghai showing the highest month-on-month increase of 0.7% [1] - Other cities with notable increases include Hangzhou and Chengdu, both at 0.5%, while cities like Ningbo, Tianjin, Jinan, and Hefei also experienced slight price increases [1] - Year-on-year, only 2 cities reported an increase in new housing prices, with Shanghai at 5.7% and Taiyuan at 1%, while most cities maintained stable prices compared to the same period last year [1] Second-Hand Housing Market - In the second-hand housing market, 14 cities reported either an increase or stable prices month-on-month, with Hangzhou leading at 1%, followed by Beijing at 0.5% and Shanghai at 0.4% [1] - The trend of stabilizing prices is particularly evident in first and second-tier cities [1] Market Structure - There are notable differences in performance across different cities and between new and second-hand housing markets [1] - In Shanghai, new housing prices for properties larger than 144 square meters saw the highest increase, while for second-hand housing, the price increase was most significant for units sized between 90 to 144 square meters [1][2] - In Hangzhou, the most resilient new housing prices were in the 90 to 144 square meter range, while for second-hand housing, the best performance was seen in units smaller than 90 square meters [2] - Taiyuan's new housing prices increased the most for units 90 square meters and below, while the strongest second-hand price performance was in the 90 to 144 square meter category [2]