Summary of Conference Call on Mainland China and Hong Kong Property Markets Industry Overview - **Mainland China Property Market**: The asking price index for tier-1 cities has reached a new low, indicating a challenging market environment. The Centaline secondary asking price index dropped from 19.7 to 19.3, marking the lowest level since May 2024 [5] - **Hong Kong Property Market**: The Financial Secretary expressed a "cautiously optimistic" outlook for retail sales, suggesting potential recovery in private consumption after four quarters of decline [5] Key Insights and Data Mainland China - **Sales Performance**: - 60-city primary sales decreased by 14% year-over-year (Y/Y), slightly improving from a 25% decline the previous week. Compared to the four-year average, sales were 68% below, improving from a 72% decline [5] - 12-city secondary sales Y/Y decline narrowed from -6% to -4% [5] - **Market Indicators**: - Centaline manager confidence index improved from 46.1 to 46.6 but remains low [5] - Property agencies' web traffic index worsened to -24% Y/Y, indicating reduced interest [5] - **Inventory Levels**: Unsold residential inventory fell by 6% quarter-over-quarter (Q/Q) to 21.2K units, the lowest since Q4 2023 [5] - **Price Trends**: Secondary home prices rose by 1% week-over-week (W/W), the highest increase since March 2025 [5] - **Top Picks**: Recommended stocks include CR Land, CR Mixc, and COLI among large-cap state-owned enterprises (SOEs), and Longfor and Jinmao among high-beta names [5] Hong Kong - **Retail Outlook**: The Financial Secretary is optimistic about June retail sales, which could positively impact Link REIT and Wharf REIC [5] - **Sales and Inventory**: - Unsold residential inventory remains at 15 months, with potential supply decreasing from 105K to 101K units over the next 3-4 years [5] - Major projects like Villa Garda III sold 77% of units after an 18% cut in average selling price (ASP) [5] - **Market Dynamics**: - The sector rose by 4% last week, outperforming the Hang Seng Index (HSI) [5] - Outperformers included NWD (+13%) and Wharf REIC (+8%), while underperformers were Champion and HKL (both -1%) [7] - **Investor Sentiment**: Investors showed caution regarding Vanke's potential nationalization and expressed concerns over Longfor's contracted sales and refinancing arrangements [7] Additional Important Points - **Web Traffic and Appointments**: The property agency web traffic index and weekend viewing appointments indicate fluctuating interest levels in the market [45][46] - **Secondary Listings**: The number of secondary listings on Centaline decreased from over 35K units in late May to 32K units last week, which may help stabilize home prices [5] - **Tourist Arrivals**: Hong Kong's tourist arrivals showed a significant increase, with 1,128,801 arrivals recorded in the last week, a 21% increase W/W [63] This summary encapsulates the critical insights and data from the conference call regarding the property markets in Mainland China and Hong Kong, highlighting both challenges and opportunities for investors.

Core Insights - Brisbane's property sales speed is the second fastest among Australian capital cities, with 64% of properties sold within 15 to 30 days, compared to the national median of 31 days [1][3] - 19% of properties in Brisbane are sold within the first 14 days of listing, indicating a healthy market with 83% of sales occurring quickly [1][3] - Perth outperforms Brisbane with 97% of properties sold within the first month, but concerns about market stability exist due to rapid growth [3][10] Market Dynamics - Brisbane's population growth is a key factor driving faster sales compared to Hobart and Canberra [5] - The average days on market for Brisbane properties is projected to increase from 18 days in June 2024 to 21 days in June 2025, while the national average is expected to rise from 29 to 31 days [7] - The overall trend shows an increase in the time properties remain on the market post-pandemic [6] Comparative Analysis - In terms of sales within 0-14 days, Perth leads with 76%, while Brisbane has 19% [9] - The distribution of sales in Brisbane shows 64% within 15-30 days, 15% within 31-60 days, and 0% beyond 90 days [9] - Factors contributing to Brisbane's strong market performance include a mild climate and significant immigration, despite rising construction costs impacting buyers [10]

Summary of Conference Call Notes Industry Overview: China Property Key Points on Sales Performance - Top 100 developers' contract sales declined by **21% YoY** in June 2025, worsening from **-10% in May 2025** due to: 1. Higher base in June 2024 from policy easing in mid-May 2024 2. Lack of policy easing support [2][6] - On a **MoM basis**, contract sales increased by **17%**, lower than the average **30%** from 2020 to 2024 [2][7] - In the first half of 2025, combined sales for top 100 developers fell by **11% YoY**, compared to **-8% YoY** in May 2025 [2][6] Performance of Luxury Projects - Demand for luxury projects remained strong, exemplified by Sunac's Shanghai One Central Park selling out in **2 hours**, significantly boosting Sunac's contract sales in June 2025 [2][6] Regional Developer Performance - Regional developers (e.g., Jinmao, C&D International, Yuexiu Property, Greentown China) outperformed the sector average, focusing on tier 1 and core tier 2 cities, benefiting from resilient luxury demand [2][6] Future Outlook - Expectations for top 100 contract sales to improve YoY in **3Q25** due to a lower base effect [2][6] Secondary Market Insights - As of June 25, 2025, secondary listings in **50 cities** increased by **9.5% YoY** and **8.6% YTD**; Tier-1 cities saw a **4.4% YoY** and **5.3% YTD** increase [3][9] - Secondary transaction volume for **12 cities** increased by **4% YoY** on a 30-day moving average, down from **7% in May 2025** [3][9] Implications for Property Listings - The rise in secondary listings is attributed to: 1. Slowing secondary transactions 2. Upgraders selling existing homes to purchase luxury new homes [3][9] Developer Performance Comparison - SOE developers' contract sales in June declined by **23% YoY**, similar to the **21% YoY** decline of top 100 developers; semi-SOE and POE developers saw declines of **33%** and **11%** respectively [4][25] - Current market shares: SOE developers at **58%**, POE developers at **31%** [4][25] Sales Data Highlights - Top 100 developers' combined gross contract sales value dropped by **21% YoY** in June, compared to **-10% YoY** in May [18][20] - The combined attributable contract sales GFA decreased by **35% YoY** in June, worsening from **-20% YoY** in May [13][20] Risks and Opportunities Downside Risks - Government policies restricting demand and mortgage lending - Tight financing conditions for developers - Lower-than-expected residential growth in China's economy [31] Upside Risks - Potential policy loosening that could boost residential property sales and prices - Large-scale asset disposals at fair prices by developers to ease liquidity pressures [31]

Core Insights - The recent surge in homebuyers driven by favorable real estate policies has led to a peculiar phenomenon where west-facing units are selling out quickly while east-facing units are struggling to attract buyers [1][7] - This trend contradicts traditional beliefs that favor east-facing units due to cultural significance and morning sunlight [1] Price Advantage - West-facing units are generally priced lower, with a price difference of approximately 500 yuan per square meter compared to east-facing units. For a 100 square meter apartment, this translates to a savings of 50,000 yuan, making it appealing for budget-conscious buyers [1][3] Technological Advancements - Improvements in building materials and technology have mitigated the traditional drawbacks of west-facing units, such as excessive heat from afternoon sun. New developments now utilize better insulation and soundproofing materials, making west-facing units more comfortable [5][3] Ongoing Issues with East-facing Units - East-facing units still face persistent issues like water seepage during rainy seasons, leading to dampness and mold on interior walls. This ongoing problem discourages potential buyers from choosing east-facing units [7][3] Conclusion - The combination of price advantages, technological improvements, and unresolved issues with east-facing units has resulted in a shift in buyer preferences, highlighting a new trend in the real estate market where rational decision-making takes precedence over traditional beliefs [7][1]