Core Viewpoint - The recent adjustments in Shanghai's real estate policies are expected to provide a temporary boost to market sentiment, particularly in the local housing market [3]. Policy Adjustments - The new policies include the removal of purchase limits for local residents and non-local residents who have paid social security or taxes for over a year, as well as an increase in the purchase limit for single residents in the inner ring from one to two units [3]. - The policies also optimize housing provident fund loans, allowing for a 15% increase in loan limits for purchasing new green buildings and enabling the withdrawal of provident funds for down payments without affecting loan limits [3]. - The mortgage interest rate pricing mechanism will no longer differentiate between first and second homes, and property tax exemptions will be provided for non-local residents on their first home [3]. Market Reaction - Following the announcement, A-share developers' stock prices increased by 4.0%, outperforming the CSI 300 index by 1.9 percentage points, while H-share developers' stock prices rose by 2.0%, surpassing the Hang Seng China Enterprises Index by 0.2 percentage points [2]. - The overall performance of real estate stocks has been positive, with A-share developers up 6.9% and H-share developers up 9.8% since early August [4]. Future Outlook - The effectiveness of these policy adjustments is expected to be regional and temporary, with the overall improvement in real estate sales volume and prices still dependent on the implementation of policies related to inventory housing and urban village renovations [3][4]. - The recent policy changes in Shanghai align with similar measures taken in Beijing, both aimed at stimulating demand from potential buyers in peripheral areas and enhancing the purchasing power of first-time and upgrading homebuyers [3].