Summary of Real Estate Market Conference Call Industry Overview - The real estate market remains at a low level, with a year-on-year decline exceeding 30% [1][3] - Significant differentiation among companies, with only one-third of real estate firms achieving month-on-month growth [2][5] - The top ten firms, including China Overseas, Greentown, China Merchants, and Huafa, showed notable growth rates of 20% to 30% [2][1] Key Market Trends - Supply in first-tier cities has significantly decreased, with Beijing, Shanghai, and Shenzhen experiencing substantial declines [1][3] - Beijing's new supply was only 130,000 square meters, down over 30% month-on-month and nearly 70% year-on-year [3] - Shanghai's new supply was 310,000 square meters, with overall land market activity remaining sluggish [3] - Guangzhou's new home market remained relatively stable, benefiting from new regulations that accounted for 62% of new supply [12][1] - Shenzhen's transaction volume dropped significantly, with a month-on-month decline of 32% and a year-on-year decline of 50% [11][1] Sales Performance - In August, real estate sales continued to decline, with a month-on-month drop of 1.9% and a year-on-year drop of 17.6% [2] - Cumulatively, from January to August, the sales of the top 100 real estate firms fell by 13.1% [2] - The transaction volume in 30 key cities decreased by 12% month-on-month and 17% year-on-year in August [5][1] Policy Impact - The cancellation of purchase restrictions in Beijing on August 8 had limited effects, with transaction volumes remaining stable despite a 16% increase in visitor numbers [9][1] - New policies in Shanghai introduced on August 25 did not significantly stimulate the market, with only slight improvements in certain segments [10][1] - The overall market is still waiting for a significant policy breakthrough as current data shows no signs of recovery [21][1] Future Expectations - There is an expectation of a 30% to 50% increase in new supply in September, driven by development cycles [19][1] - The stability of core cities and new product regulations may provide some assurance for the market, but overall caution is advised [6][1] Inventory and Market Dynamics - The inventory situation varies, with some cities like Changsha and Wuhan showing high turnover rates due to unique project designs [25][1] - The overall inventory in Wuhan is approximately 15 million square meters with a 21-month turnover cycle, while Changsha has about 5 million square meters with an 18-month cycle [30][1] Conclusion - The real estate market is characterized by significant challenges, including declining sales, reduced supply, and limited policy effectiveness. However, certain firms and cities are showing resilience, indicating potential areas for investment and recovery in the future.

Summary of Key Points from the Conference Call Industry Overview - The real estate market in August is overall sluggish, with transaction area in 30 key cities decreasing by 12% month-on-month and 17% year-on-year, only slightly above the levels seen during the Spring Festival [1] - The supply volume is at a near seven-year low, with a month-on-month decrease of 28% and a year-on-year decrease of 36% [1][5] - The top 100 real estate companies experienced a general decline in sales, but leading firms like Greentown, China Overseas, and Huafa saw month-on-month sales growth exceeding 30%, supported by core cities and high-end projects [1][2] Sales Performance - In August, the sales amount of the top 100 real estate companies decreased by 1.9% month-on-month and 18% year-on-year, with a cumulative year-on-year decrease of 13.1% [2] - There are significant disparities among the top 100 companies, with leading firms relying on high-end projects in core cities, while many companies outside the top 20 are seeing continuous sales declines [3] Market Dynamics - The first-tier cities' new housing market is undergoing a comprehensive adjustment, with transaction volumes experiencing greater declines than second and third-tier cities [1][13] - The average opening sales rate in the 30 key cities in August was approximately 41%, an increase of nearly 11 percentage points month-on-month and nearly 15 percentage points year-on-year [18] - The supply in first-tier cities has been decreasing for four consecutive months, with significant declines in Beijing, Shanghai, and Shenzhen [5][6] Regional Insights - Guangzhou is the only first-tier city with a month-on-month increase in supply, with over 400,000 square meters supplied in August [7] - Second and third-tier cities are in an adjustment phase, with an overall month-on-month transaction decrease of 11% and a year-on-year decrease of 16% [15] - Some cities like Chengdu, Qingdao, Tianjin, Xi'an, and Wuhan still recorded monthly transaction volumes exceeding 400,000 square meters [16] Policy Impact - New policies in Beijing have stimulated an increase in visitor numbers, with a 16% rise in visits, while the effects of Shanghai's policies have yet to be seen [13][14] - The supply-demand ratio has decreased to 0.69, indicating a significant drop in market activity, with many cities experiencing increased inventory pressure [22][23] Future Outlook - A low recovery in transaction volumes is expected in September, driven by the traditional peak season and policy relaxations in first-tier cities [29] - The market is anticipated to see a gradual recovery, but significant reversals are unlikely due to ongoing economic pressures and consumer confidence issues [34] Additional Insights - The land market has cooled down, with fewer core and quality plots being offered, leading to a seasonal low in overall transaction volume [26][28] - The performance of new regulatory products is declining, with significant disparities in sales rates among different projects [21] This summary encapsulates the critical insights from the conference call, highlighting the current state of the real estate market, sales performance, regional dynamics, policy impacts, and future outlook.

Core Viewpoint - The real estate market in China is experiencing a decline in transaction volumes and sales performance among top developers, with expectations of a slight recovery in September due to seasonal factors and policy support [17][20][30]. Group 1: Market Performance - In the first eight months of 2025, the cumulative transaction volume across 30 cities reached 78.69 million square meters, reflecting a slight decrease of 3% compared to the same period last year [3][29]. - In August 2025, the top 100 real estate companies achieved a sales turnover of 207.04 billion yuan, which is a month-on-month decrease of 1.9% and a year-on-year decrease of 17.6% [18][20]. - The sales performance of the top 100 companies remains at historically low levels, with 33% of these companies reporting month-on-month growth in August [20][22]. Group 2: Sales Thresholds - The sales thresholds for the top 100 real estate companies have decreased significantly, with the threshold for the top 10 companies dropping by 4.3% to 56.06 billion yuan, and the threshold for the top 100 companies decreasing by 23.8% to 3.51 billion yuan [22][24]. - The sales performance across different tiers of companies is declining, with the top 21-30 tier showing the smallest decline at 8.7% year-on-year [24]. Group 3: Future Outlook - The overall supply and demand in the real estate market continued to decline in August, but there are expectations for a low-level recovery in September due to increased supply and favorable policies [29][30]. - The market is expected to see a recovery in transaction volumes as the traditional marketing season approaches, with developers likely to accelerate their sales efforts and offer greater discounts [30][31]. - There is a notable divergence in market performance between first-tier and second/third-tier cities, with core cities like Beijing and Shanghai showing signs of recovery due to policy adjustments [30][31].

Investment Rating - The report maintains a "Recommendation" rating for the real estate industry [2] Core Insights - The real estate index increased by 0.5% in the 34th week, ranking 31st among 31 primary industry sectors [8] - New housing transactions in 20 monitored cities decreased by 28% year-on-year, while second-hand housing transactions increased by 5% year-on-year [21][26] - Effective policies are crucial for driving market recovery, with a focus on broad fiscal measures and urban village renovations [34] Industry Basic Data - Total number of stocks: 107 [2] - Total market capitalization: 1,198.27 billion [2] - Circulating market capitalization: 1,148.68 billion [2] Sales Performance - In the 34th week, new housing transaction area was 1.47 million square meters, with a daily average of 210,000 square meters, reflecting a 5% increase week-on-week but a 28% decrease year-on-year [21][25] - Cumulative new housing transaction area from the beginning of the year in 20 cities was 65.28 million square meters, down 9% year-on-year [21] - Second-hand housing transaction area in 11 cities was 1.85 million square meters, with a daily average of 265,000 square meters, showing a 7% increase week-on-week and a 5% increase year-on-year [26][30] Policy Developments - Beijing announced support measures for employees affected by flooding, allowing them to withdraw housing provident fund for rent payments [16] - Guangzhou implemented a temporary policy for converting commercial loans to housing provident fund loans, with specific conditions for eligibility [16] - Chengdu optimized housing provident fund policies, including lowering down payment ratios and increasing loan limits [16] Company Dynamics - Longfor Group acquired a residential land plot in Chengdu at a starting price of 14,200 yuan per square meter [19] - CIFI Holdings reported total revenue of 12.281 billion, a year-on-year decrease of 39.22% [20] - Greentown China reported total revenue of 53.368 billion, a year-on-year decrease of 23.49% [20] Investment Strategy - Focus on companies with strong product moats that are likely to exhibit strong alpha characteristics [34] - Emphasis on the stability of rental income from quality commercial real estate companies [34] - Attention to the stock brokerage business in the existing housing market [34]

Core Viewpoint - The People's Bank of China (Shanghai Headquarters) announced that commercial personal housing loan interest rates in Shanghai will no longer differentiate between first and second homes, leading to a reduction in the interest rate for second homes from 3.45% to 3.05%, which is expected to lower the cost of purchasing homes for improving demand [1][3][4]. Summary by Relevant Sections Policy Changes - The new policy eliminates the distinction between first and second home loan interest rates, which is expected to enhance the purchasing power of homebuyers looking to upgrade their living conditions [1][4]. - The adjustment is part of a broader strategy to stabilize the real estate market in Shanghai, reflecting a shift from controlling housing prices to stabilizing the market [2][11]. Financial Impact - For a loan of 1 million yuan over 30 years, the monthly payment will decrease by approximately 220 yuan, and total interest payments will drop by about 80,000 yuan [2][3]. - The change is anticipated to significantly reduce the financial burden on residents, thereby encouraging housing consumption [3][4]. Market Reactions - Experts believe that this policy will positively impact the housing market, particularly during the upcoming peak sales season [4][11]. - The move is seen as a potential precursor for other first-tier cities like Beijing and Shenzhen to follow suit, as they currently maintain differentiated interest rates [11][12]. Long-term Implications - The policy is expected to stimulate demand for second homes, particularly among those looking to upgrade, while also allowing banks greater flexibility in pricing based on individual risk assessments [5][10]. - The shift towards a more market-oriented pricing mechanism is likely to enhance competition among banks, focusing on service innovation rather than just interest rate competition [10][12].

1. Report Industry Investment Ratings - Not provided in the document 2. Core Views - Shanghai's new real - estate policies will release housing demand, especially in outer - ring areas with high inventory, and may lead to a rebound in trading volume [6] - The coking coal market is short - term strong and medium - term bearish. Short - term strength is due to supply contraction expectations and positive macro - sentiment, while medium - term decline is because of weak demand in the peak season [7][8] 3. Summary by Related Catalogs 3.1 Real Estate - On August 25, Shanghai issued "Six Measures for the Housing Market", including relaxing outer - ring purchase restrictions, allowing single people to buy as families, and enabling housing provident funds to pay down - payments. This will directly benefit the release of housing demand, especially for high - inventory projects in outer - ring areas [6] 3.2 Coal and Coke - **Short - term**: Coal mine accidents lead to supply contraction expectations for coking coal, and combined with positive macro - sentiment, coking coal prices are expected to rise [7] - **Medium - term**: Terminal demand in the peak season is likely to be weak, and the role - change of traders will increase supply pressure, leading to price declines and profit compression [8] 3.3 Commodities - **Precious Metals**: Gold is influenced by the dovish stance of Powell at the JH meeting, and silver is approaching its previous high [11] - **Base Metals**: Copper's price increase is restricted by the rising US dollar; zinc shows narrow - range fluctuations; lead lacks driving forces and its price fluctuates; tin moves in a range; aluminum's fluctuations converge; alumina declines slightly; and casting aluminum alloy follows electrolytic aluminum [11][22][25] - **Energy Metals**: Nickel moves in a narrow range, and stainless steel fluctuates at a low level in the short - term; lithium carbonate may continue to fluctuate in a range due to limited drivers [11][39][45] - **Industrial Metals**: Iron ore is supported by the non - significant decline in macro - risk appetite; rebar and hot - rolled coil fluctuate widely due to repeated market sentiment; ferrosilicon and silicomanganese fluctuate widely driven by sector sentiment; coke and coking coal also fluctuate widely [11][53][57][61][64] - **Agricultural Products**: Palm oil waits for a pull - back to go long; soybean oil consolidates at a high level; soybean meal may adjust and fluctuate; and corn moves in a range [11][64][66][68] - **Chemicals**: Para - xylene is in a tight supply - demand balance and has a strong upward trend; PTA has a new device put into operation by Sanfangxiang and is suitable for positive spreads; MEG has a strong upward trend; rubber moves in a range; synthetic rubber is short - term strong and medium - term range - bound; asphalt's cracking continues to weaken; LLDPE fluctuates strongly in the short - term; PP rebounds in the short - term and is a medium - term oscillating market; caustic soda corrects in the short - term; paper pulp moves in a range; glass's original sheet price is stable; methanol is supported in short - term oscillations; urea is in a weak operation; styrene is short - term strong and medium - term bearish; and soda ash's spot market changes little [11][70] - **Others**: Logs fluctuate repeatedly [66]

Core Viewpoint - Shanghai has introduced new housing policies aimed at reducing purchase barriers and promoting a stable and healthy development of the real estate market, effective immediately [1] Policy Adjustments - The new regulations allow local residents and non-local residents who have paid social insurance or income tax for over one year to purchase unlimited housing outside the outer ring, including both new and second-hand homes [1] - Single adults will be subject to the same housing purchase restrictions as families [1] Market Impact - The policy changes are expected to stimulate market demand significantly, with over 60% of new residential transactions occurring outside the outer ring this year [3] - The outer ring has seen concentrated demand for first-time and improved housing needs, which the new policies aim to support [5] Financial Support Measures - The new policies optimize housing provident fund regulations, allowing for increased loan limits and enabling borrowers to withdraw funds for down payments without reducing their loan eligibility [8][10] - The maximum loan limit for first-time buyers has increased from 1.6 million to 1.84 million yuan, with additional increases for families with multiple children [10] Tax Incentives - The new regulations exempt first-time home purchases by eligible non-local residents from property tax, while providing a tax exemption for the first 60 square meters of combined family housing area for second and subsequent purchases [14] Interest Rate Adjustments - The new policies will lead to a reduction of over 40 basis points in mortgage rates for second homes in central urban areas, significantly lowering monthly repayments for buyers [12]

Group 1 - The core viewpoint of the new housing policy in Shanghai is to lower the threshold for home purchases and promote a stable and healthy development of the real estate market [1][2] - The new policy allows local residents and non-local residents who have paid social insurance or income tax for over one year to purchase homes without restrictions on the number of properties in areas outside the outer ring [1][2] - The policy aims to stimulate market demand and enhance transaction activity in the outer ring areas, which have a concentrated demand for first-time and improved housing [1][2] Group 2 - The new policy optimizes the housing provident fund by increasing loan limits and allowing for simultaneous withdrawals and loans, thereby supporting housing consumption [3][4] - The maximum loan amount for first-time homebuyers has been increased from 1.6 million to 1.84 million yuan, with additional increases for families with multiple children [4] - The new policy also includes tax exemptions for eligible non-local residents purchasing their first home, and a tax deduction for the second home based on the total housing area [4]

Core Viewpoint - Shanghai's recent adjustments to real estate policies are more aggressive than market expectations, following similar moves in Beijing, which is expected to boost market sentiment and stabilize the real estate market [1][2]. Policy Adjustments - The new policy reduces housing purchase restrictions significantly, allowing local residents to buy unlimited properties outside the outer ring and limiting them to two properties within the inner ring. Non-local residents can also purchase without limits outside the outer ring if they have paid social insurance or income tax for at least one year, and are limited to one property within the inner ring if they have paid for three years [2][3]. - The adjustments are seen as a response to high inventory levels in certain areas, particularly outside the outer ring, which is expected to alleviate pressure on these markets [2][5]. Housing Loan Policies - The new regulations eliminate the distinction between first and second home loan interest rates, allowing banks to set rates based on their operational conditions and customer risk profiles. This change is expected to lower the cost of borrowing for residents [6][7]. - The unified interest rate for commercial personal housing loans is set at LPR-45 basis points, which is a reduction from previous rates, thereby easing the financial burden on homebuyers [6][7]. Market Impact - The policy changes are anticipated to stimulate demand in the outer ring market, reduce hesitation among potential buyers, and contribute to a healthier balance between housing supply and demand in the long term [5][10]. - The overall approach in Shanghai is viewed as broader and more impactful compared to Beijing's measures, with expectations that other cities like Shenzhen may follow suit, further enhancing market confidence [10].

Core Viewpoint - Shanghai's recent policy adjustments aim to optimize the real estate market by reducing housing purchase restrictions and enhancing housing fund policies, which are expected to stimulate market activity and stabilize prices [1][4][5]. Group 1: Housing Purchase Policy Adjustments - The new policy allows eligible resident families to purchase an unlimited number of homes outside the outer ring of Shanghai, while limiting purchases to two homes within the inner ring [4][5]. - Non-local residents can also buy homes outside the outer ring without restrictions if they have paid social insurance or income tax in Shanghai for at least one year [4][5]. - The policy treats single individuals as families, effectively increasing the number of eligible home purchases and reducing previous restrictions [4][5]. Group 2: Housing Fund and Loan Policy Enhancements - The policy increases the maximum loan amount for housing funds, with first-time buyers now eligible for up to 1.84 million yuan, and families with multiple children can receive even higher amounts [5][6]. - The new regulations support the "withdraw and loan" method for housing funds, allowing buyers to use their housing fund for down payments without affecting their loan limits [6][7]. - The differentiation in interest rates for first and second homes has been removed, which is expected to alleviate repayment pressure for buyers looking to upgrade their housing [7][8]. Group 3: Market Impact and Expectations - The adjustments are anticipated to alleviate inventory pressure in the outer ring areas, where current inventory levels account for 80% of total stock [5][8]. - The new policies are expected to boost market activity, particularly in the outer ring's new and second-hand housing markets, leading to a more stable price environment [8][9]. - Experts predict that the upcoming "golden September and silver October" sales period will see increased activity due to these favorable policy changes [9][10].