2025-12-30 14:41Summary of China Property Weekly Wrap Industry Overview - The report focuses on the Chinese property market, specifically analyzing the performance of primary and secondary real estate transactions in the context of fiscal year 2025 (FY25) and the outlook for 2026. Key Highlights 1. Policy Initiatives: - The Ministry of Housing and Urban-Rural Development (MOHURD) has outlined priorities for 2026 aimed at stabilizing the property market, including: - City-specific measures to control new supply and reduce inventory through urban renewal and buybacks of unsold homes for affordable housing [1] - Promotion of high-quality housing initiatives [1] - Enhancement of the "white-list" financing mechanism to support developers' financing needs [1] - Empowerment of local governments to adjust housing policies to support demand [1] - Advancement of new development models to mitigate delivery risks [1] 2. Local Policy Adjustments: - Beijing has eased local home purchase restrictions, allowing families with multiple children to buy an additional home within the 5th Ring Road [2] - Potential adjustments in home-purchase rules in other Tier-1 cities like Shanghai and Shenzhen are anticipated [2] 3. Market Activity: - Transactions in the primary market improved by 29% week-over-week (wow), while the secondary market saw a 5% wow increase, despite year-over-year (yoy) declines of -16% and -1% respectively [3][8] - The ratio of units with price cuts narrowed to 15.4 times those with price increases in December, down from approximately 18 times in the previous months [3] 4. Sales and Inventory Data: - New home sales volume was -37% yoy, with search activities down 1.1% wow [4] - Inventory levels increased by 0.1% wow but decreased by 3.5% from the end of 2024, with inventory months at 28.4 [20] 5. Valuation Insights: - Stronger state-owned enterprise (SOE) developers experienced a -1% wow decline in share prices, while privately-owned enterprises (POE) saw a -2% wow drop [32] - Offshore developers are trading at an average 37% discount to end-2026 estimated net asset value (NAV) [32] 6. Sales Forecasts: - Property sales in approximately 75 cities suggest that top-100 developers' presales are likely to decline 41% yoy in December, compared to -36% in November [8] - Completions are expected to show a mid-single-digit percentage improvement yoy in December, with a -10% yoy decline projected for FY25 [24] 7. Market Sentiment: - Secondary market sentiment remains steady, with subscription-based sales and visitations flattening [3] - Home appliance sales are likely to record a yoy decline in December based on trends in 20 cities [8] Additional Insights - The report indicates a potential steepened decline in new starts in December, based on land sales trends and cement shipment ratios [8] - The overall market sentiment reflects cautious optimism due to policy adjustments and localized easing measures, which may influence investor focus in the near term [2][3] This summary encapsulates the critical insights and data points from the China Property Weekly Wrap, providing a comprehensive overview of the current state and outlook of the Chinese property market.