Core Viewpoint - The real estate market in China has shown significant recovery in March 2026, with new home sales and second-hand home sales experiencing substantial month-on-month increases of 89% and 117% respectively, indicating a positive trend in market activity [15][28]. Sales Performance - In March 2026, typical real estate companies achieved a sales revenue of 206.5 billion yuan, representing a month-on-month growth of 127.1% and a cumulative sales revenue of 426.1 billion yuan for the first three months of the year [16][21]. - Seven companies reported year-on-year sales growth exceeding 100%, with notable performances from private firms such as Junyi Holdings and Maoyuan Holdings, which saw increases of 329.4% and 216.2% respectively [20][22]. Market Dynamics - The market is experiencing structural differentiation, with luxury properties in core urban areas and high-value affordable housing in suburban areas performing well. For instance, projects like Shenzhen Bay and Shanghai Bund have achieved remarkable sales figures [23]. - Conversely, properties in the outskirts are facing challenges due to inadequate infrastructure and high commuting costs, leading to slower sales [23]. Policy Environment - The government has prioritized stabilizing the real estate market as part of the "14th Five-Year Plan," which aims to boost consumer confidence and stabilize market expectations [25][26]. - The Ministry of Natural Resources has issued guidelines linking new land supply to the revitalization of existing land, which is expected to influence the supply side of the real estate market [26]. Market Transactions - In March 2026, the transaction area for new residential properties in 50 key cities reached approximately 11.33 million square meters, marking a significant month-on-month increase of 89% [27]. - The second-hand housing market also showed robust activity, with a transaction area of about 17.97 million square meters in March, reflecting a month-on-month increase of 117% and a year-on-year growth of 6% [28]. - The land market has seen a cyclical rebound, with transaction volumes and values increasing significantly in March 2026, indicating a recovery in land sales [29].

Investment Rating - The report maintains a "Positive" rating for the real estate and property management sectors [4][34]. Core Views - The report emphasizes that the real estate sector is a crucial pillar of the national economy and an important source of wealth for residents. It highlights the need for effective measures to stabilize the real estate market amidst new challenges [4][34]. - The report anticipates that the bottom of the industry fundamentals is approaching, supported by recent central government policies aimed at stabilizing the market and improving residents' financial conditions [4][34]. Industry Data Summary New Home Transactions - In the week of March 14-20, 2026, new home transactions in 34 key cities totaled 2.584 million square meters, a 19% increase week-on-week. First and second-tier cities saw a 15.7% increase, while third and fourth-tier cities experienced an 80% increase [4][5]. - Year-on-year, new home transactions in March (up to March 20) decreased by 16.6%, with first and second-tier cities down 12.9% and third and fourth-tier cities down 48.2% [4][8]. Second-Hand Home Transactions - In the same week, second-hand home transactions in 13 key cities totaled 1.288 million square meters, a 16% increase week-on-week. However, March's cumulative transactions were down 20.5% year-on-year [4][14]. Inventory and Supply - In the week of March 14-20, 2026, 15 key cities launched 940,000 square meters of new supply, with total sales of 960,000 square meters, resulting in a sales-to-launch ratio of 1.01. The average months of inventory for the last three months was 28.4 months, an increase of 0.48 months [4][24]. Policy and News Tracking - The report notes that the "Qiushi" magazine reiterated the importance of the real estate sector for the national economy and residents' wealth, calling for precise measures to stabilize the market [4][34]. - Recent policies include adjustments to commercial property loan requirements in Shanghai and measures in Nanjing to support the real estate market, such as interest subsidies for "old-for-new" transactions [4][34]. Company Performance Real Estate Companies - Several real estate companies reported their 2025 annual performance: - China Merchants Shekou: Revenue of 154.7 billion yuan (-13.5%); net profit of 1.02 billion yuan (-74.6%) [4][42]. - Beike: Revenue of 94.6 billion yuan (+1.2%); net profit of 2.99 billion yuan (-26.3%) [4][45]. - Greentown Service: Revenue of 19.16 billion yuan (+7.1%); net profit of 0.88 billion yuan (+29.9%) [4][45]. Property Management Companies - The report highlights the performance of property management companies, noting that Beike's revenue increased by 1.2%, while Greentown Service's revenue grew by 7.1% [4][45].

Core Viewpoint - The secondary market demand is expected to continue improving and outperform the primary market, with the new housing market remaining stable this year. Buyers are likely to prefer state-owned enterprise projects. As market sentiment improves, leading private enterprises may accelerate their debt restructuring processes. The company maintains a positive long-term outlook on China Resources Land (01109/Buy) and Yuexiu Property (00123/Buy), which have shown strong sales performance and execution capabilities in recent years [1][6]. Group 1: Sales Data and Market Trends - In February, the total sales of the top 100 developers decreased from 1,822 billion RMB in January to 1,252 billion RMB, a month-on-month decline of 31.3% [2][7]. - The sales decline among the 20 tracked major listed developers was reduced to 27.4% month-on-month, primarily due to a decrease in sales area (down 11.1% month-on-month) and a drop in average sales price (down 26.5% month-on-month) [2][7]. - Among the top 10 developers by sales in February, 9 were state-owned enterprises, with Poly Developments ranking first. The market share of state-owned enterprises in the top 50 developers slightly decreased to 78.6% in February from 79.0% in January 2026 [2][7]. Group 2: Price Index and Policy Environment - According to the National Bureau of Statistics, the new residential price index for 70 major cities fell by 3.3% year-on-year and 0.4% month-on-month in January 2026, while the second-hand residential price index dropped by 6.2% year-on-year and 0.5% month-on-month [3][8]. - The real estate policy environment has turned broadly accommodative in February, with a focus on financial policies to support housing and economic recovery. The government work report released on March 5, 2026, emphasized the need to stabilize the real estate market [3][9].

Group 1 - The secondary market demand is expected to improve and outperform the primary market, with the new housing market remaining stable this year, and buyers continuing to prefer state-owned enterprise projects [1] - Leading private enterprises may accelerate their debt restructuring processes as capital market sentiment improves [1] - China Resources Land (01109) and Yuexiu Property (00123) are favored for their strong sales performance and execution capabilities in recent years [1] Group 2 - In February, the sales data of the top 100 developers showed a decline, with total sales dropping from 182.2 billion RMB in January to 125.2 billion RMB, a decrease of 31.3% month-on-month [1] - The sales volume of the 20 major listed developers decreased by 27.4% month-on-month, attributed to a decline in sales area (down 11.1%) and average sales price (down 26.5%) [1] - Among the top 10 developers by sales in February, 9 were state-owned enterprises, with Poly Developments ranking first [1] Group 3 - The price index for new residential properties in 70 major cities fell by 3.3% year-on-year and 0.4% month-on-month in January, while the second-hand residential price index dropped by 6.2% year-on-year and 0.5% month-on-month [2] - The real estate policy in February was broadly relaxed, with a focus on financial policies to support the recovery of the real estate market and the overall economy [3] - The government work report released on March 5 emphasized the need to stabilize the real estate market, with expectations for market recovery as workers return to cities and online signing resumes [3]

Core Insights - The report emphasizes the government's focus on stabilizing the real estate market, with a shift from risk prevention to supporting people's livelihoods, particularly for newly married and newborn families [5][16][17] - The "small spring" recovery trend in the real estate market continues, with significant increases in new and second-hand housing transactions across various cities [5][9] - The report indicates a notable improvement in new housing supply, although the overall supply levels have not yet returned to normal [5][9] Policy Overview - The central government has reiterated its commitment to stabilizing the real estate market, with a target economic growth rate adjusted to 4.5%-5% for 2026 and a budget deficit maintained at 4% [16][18] - The government aims to enhance fiscal efficiency by allocating 755 billion yuan for central budget investments and 800 billion yuan for long-term special bonds [16][18] - There is a clear intention to support the housing needs of new citizens and young families, with policies expected to strengthen throughout the year [17][19] Market Performance - New housing transactions in 50 cities increased by 183% week-on-week, with a year-on-year growth of 20.7% [5][9] - Second-hand housing transactions also saw a significant rise, with an increase of 189% week-on-week in 11 cities and a year-on-year growth of 13% [5][9] - The report notes that the transaction volume for second-hand homes has maintained a positive trend, with a cumulative year-on-year increase of 36.1% since the beginning of the "small spring" [5][9] Supply and Demand Dynamics - New housing launches improved significantly, with a week-on-week increase of 557%, although the supply remains below normal levels [5][9] - The report highlights a slight increase in second-hand housing listings, with a 0.2% week-on-week rise in 140 cities, indicating a slow recovery in the market [5][9] - The land supply has increased, but transaction performance has been poor, with a total land sale revenue of 6.95 billion yuan, down 73.2% week-on-week [5][9] Capital Market Insights - The real estate sector underperformed in the capital market, with a decline of 4.1% compared to the Shanghai and Shenzhen 300 index [5][9] - Major real estate companies experienced varying degrees of decline, with some companies like China Overseas Land and Investment showing smaller declines compared to others [5][9] - The report notes that the C-REITs sector continues to develop, with 14 applications currently under review, indicating a proactive approach to commercial real estate investment trusts [5][9]

Investment Rating - The industry maintains a "Buy" rating [7] Core Insights - The real estate market is showing signs of stabilization, with a focus on March transaction performance [1] - Key cities are experiencing a gradual recovery in second-hand housing transactions, with Shanghai's new policies beginning to show effects [2] - Nationally, new and second-hand housing transactions are gradually recovering post-Spring Festival, although year-on-year comparisons show declines [3] Summary by Sections Key Cities - In Beijing, the average daily transaction of second-hand homes was 494 units (down 18.4% year-on-year), while new homes saw 70 units (down 40.9%) [2] - Shenzhen reported 139 second-hand homes (down 28%) and 39 new homes (down 51%) [2] - Shanghai's second-hand homes averaged 723 units (down 18%) and new homes 213 units (down 15%), with significant increases compared to the previous lunar year [2] National Overview - In 30 major cities, new home transaction area decreased by 23.3% year-on-year, but increased by 11% compared to the previous lunar year [3] - The cumulative transaction area from January to March shows a decline of 24.4% year-on-year [3] - Second-hand homes in 14 cities saw a 24.7% year-on-year decrease, but a 10.4% increase compared to the previous lunar year [3] Investment Recommendations - The traditional peak season for real estate transactions is in March and April, with Shanghai's new policies expected to release pent-up demand [4] - The report suggests focusing on leading real estate companies with land reserves in core cities and high-end products, such as Poly Developments [4] - It also highlights the potential for valuation recovery in leading intermediary agencies as the proportion of second-hand transactions continues to rise [4]

Investment Rating - The report maintains a "Positive" rating for the real estate and property management sectors, highlighting the potential for recovery in quality real estate companies and commercial properties [2][24]. Core Insights - The report indicates that the real estate market is gradually stabilizing, with government policies aimed at increasing residents' property income and utilizing monetary policy tools effectively [2][24]. - It emphasizes that the fundamental bottom of the real estate industry is approaching, supported by recent policy shifts and a significant reduction in supply-side pressures [2][24]. - The report suggests that quality real estate companies are likely to see earlier and more elastic profit recovery due to improved industry dynamics and historically low valuations [2][24]. Industry Data Summary New Home Transactions - In the week of February 28 to March 6, 2026, new home transactions in 34 key cities totaled 1.813 million square meters, a 69% increase week-on-week, with first and second-tier cities seeing a 78.2% increase, while third and fourth-tier cities experienced a 3% decline [3][4]. - Year-on-year, new home transactions in March showed a 32.1% decrease compared to the same period last year, with first and second-tier cities down 29.7% and third and fourth-tier cities down 55.9% [4][6]. Second-Hand Home Transactions - In the same week, second-hand home transactions in 13 key cities reached 1.018 million square meters, marking a 98.7% increase week-on-week, but a 29.3% decrease year-on-year [10][11]. Inventory and Supply - In the week of February 28 to March 6, 2026, 15 key cities launched 340,000 square meters of new supply, with total sales of 740,000 square meters, resulting in a sales-to-launch ratio of 2.14 times [19][20]. - The total available residential area in these cities was 88.055 million square meters, reflecting a 0.44% decrease week-on-week, with an average absorption period of 27.9 months [19][20]. Policy and News Tracking - The government work report emphasizes stabilizing the real estate market through targeted policies, inventory reduction, and improving supply channels, while also promoting income growth for low-income groups [24][27]. - The People's Bank of China indicated the flexible use of monetary policy tools, including interest rate cuts, to support economic stability and asset price recovery [24][27]. - Recent developments include the approval of commercial real estate REITs by New Town Holdings, indicating a growing interest in this investment vehicle [32][34].

Investment Rating - The report maintains a "Positive" rating for the real estate and property management sectors [3][4][60] Core Insights - The report indicates that new home sales during the Spring Festival period saw a year-on-year increase of 5.4%, with a total of 9.3 million square meters sold across 16 major cities [3][14] - The report highlights a significant recovery in the real estate market, with February sales in 34 cities showing an 88.5% year-on-year increase compared to January [9][10] - The report emphasizes the importance of government policies aimed at stabilizing the real estate market, including measures to address local government debt risks and promote housing supply [3][4] Summary by Sections Industry Data - New home sales in 34 key cities decreased by 1.1% week-on-week before the Spring Festival, with a total of 192.3 million square meters sold [4][5] - In February, new home sales in 34 cities increased by 88.5% year-on-year, with first and second-tier cities showing a 96.8% increase [9][10] - The report notes that the inventory of unsold residential properties in 15 cities was 88.7 million square meters, with a slight decrease of 0.1% week-on-week [60] Policy News - The report mentions that the publication "Qiushi" reiterated the need to stabilize the real estate market, with 12 commercial real estate REITs submitted for approval [3][4] - Various local governments have introduced new policies to stabilize the real estate market, including measures to optimize housing supply and activate existing stock [3][4] Company Dynamics - The report tracks sales data from major real estate companies, noting that China Jinmao and China Resources Land reported strong sales figures in January [3][4] - The report highlights the performance of the real estate sector, with the SW Real Estate Index declining by 0.69% compared to a 0.36% increase in the CSI 300 Index [3][4] Investment Analysis - The report recommends investing in high-quality real estate companies and commercial properties, citing an expected recovery in profitability for quality firms as the market stabilizes [3][4] - Specific recommendations include companies such as Jianfa International, Binhai Group, and China Jinmao for quality real estate, and New City Holdings and China Resources Land for commercial real estate [3][4]

Investment Rating - The report maintains a "Positive" rating for the real estate and property management sectors, highlighting the potential for recovery in quality real estate companies and commercial properties [3]. Core Insights - The report indicates that new home sales during the Spring Festival period saw a year-on-year increase of 5.4%, with a total of 9.3 million square meters sold across 16 major cities [3][13]. - The overall sentiment in the real estate market is improving, driven by recent government policies aimed at stabilizing the market and addressing local government debt risks [3]. - The report emphasizes that the fundamental bottom of the real estate sector is approaching, with expectations for quality companies to recover profits more quickly and flexibly [3]. Summary by Sections 1. Industry Data - New home sales in 34 key cities during the week before the Spring Festival totaled 192.3 million square meters, a decrease of 1.1% week-on-week, but an increase of 56.6% compared to the average weekly sales this year [4]. - In February, new home sales in 34 cities increased by 88.5% year-on-year, with first and second-tier cities showing a 96.8% increase [9]. - The inventory of new homes in 15 cities was reported at 8,870.4 million square meters, with a slight decrease of 0.1% week-on-week [54]. 2. Policy News - The report notes that the government has reiterated its commitment to stabilizing the real estate market, with various local policies being introduced to optimize housing supply and manage existing stock [3]. - Specific measures include the promotion of REITs in commercial real estate, with 12 applications submitted recently [3]. 3. Company Dynamics - Sales data for major real estate companies in January showed mixed results, with China Jinmao reporting a 13.6% increase in sales, while other companies like Poly Developments saw a 13.3% decrease [3]. - The report highlights the performance of the property management sector, which has shown resilience compared to the broader market [3]. 4. Market Performance - The SW Real Estate Index fell by 0.69%, underperforming the Shanghai and Shenzhen 300 Index, which rose by 0.36% [3]. - The report suggests that the current valuation levels for quality real estate companies are at historical lows, making them attractive for investment [3].

Core Viewpoint - The 2026 Spring Festival housing promotion event aims to stimulate real estate consumption and boost the local economy by providing various housing options and facilitating access to housing policies [1][3][5] Group 1: Event Overview - The event features 19 real estate developers and 10 second-hand housing agencies showcasing diverse housing products, including essential and improved residential options [3] - The promotion runs from February 17 to February 21, 2026, to maintain consumer interest during the Spring Festival [3] Group 2: Policy and Support - The event aligns with national and local policies to stabilize the real estate market, focusing on controlling inventory and enhancing supply [5] - Special consultation stations are set up to help citizens understand housing subsidies, public fund usage, and mortgage rate discounts, effectively lowering purchasing costs [3][5] Group 3: Market Engagement - The initiative is designed to capture the "golden window" of returning home during the Spring Festival, aiming to meet the housing needs of citizens [5] - Real estate companies are offering incentives such as "old-for-new" housing exchange policies to reduce the financial burden on buyers [7] Group 4: Community Impact - The event has garnered significant public interest, with citizens actively participating and expressing their preferences for improved housing options [7] - The promotion is expected to contribute to the stable and healthy development of the local real estate market, providing ongoing momentum for the city's economic growth [9]