One week market review
This week, the Shenwan real estate index fell 4.2%, the CSI 300 index fell 4.51%, and the relative income was 0.31%. The performance of the sector was stronger than the market.
Industry fundamentals
This week (01.21-01.27), a total of 58149 first-hand houses were sold in 58 key cities tracked by West China real estate group, with a year-on-year growth rate of – 25.3% and a month on month growth rate of 4.5%; The total transaction area was 6225000 square meters, with a year-on-year growth rate of – 19.7% and a month on month growth rate of 9.1%. This week (01.21-01.27), a total of 14177 second-hand houses were sold in 16 key cities tracked by West China real estate group, with a year-on-year growth rate of – 37.5% and a month on month growth rate of – 12.2%; The total transaction area was 1.35 million square meters, with a year-on-year growth rate of – 41.1% and a month on month growth rate of – 16%. This week (01.21-01.27), the inventory area of commercial housing in 17 key cities tracked by West China real estate group was 197.991 million square meters, with a month on month growth rate of 0.3% and a decontamination cycle of 71.7 weeks.
This week (January 17-january 23), 4312000 square meters of land were supplied, with a year-on-year growth rate of – 85.3%, and 9.21 million square meters of land were sold, with a year-on-year growth rate of – 72.4%; The land transaction amount was 8.69 billion yuan, with a year-on-year growth rate of – 87%.
This week (01.21-01.27), real estate enterprises issued a total of 8.08 billion yuan of credit bonds, with a year-on-year growth rate of – 65% and a month on month growth rate of 10.4%. Real estate collective trusts issued a total of 3.48 billion yuan, with a year-on-year growth rate of – 85.1%, a month on month growth rate of 180% and an average income of 7.3%.
Investment advice
This week, on January 24, the 2022 CBRC working meeting required that we should persevere in preventing and resolving financial risks. We will continue to follow the basic principles of “stabilizing the overall situation, overall planning and coordination, implementing policies by categories and accurately dismantling bombs”, handle risks in the financial field steadily and firmly hold the bottom line of no systemic financial risks. Compact the responsibilities of all parties and orderly promote the disposal of high-risk financial institutions. Properly deal with the rebound of non-performing assets. Adhere to the positioning that houses are used for living rather than speculation, continue to improve the long-term mechanism of “stabilizing land prices, house prices and expectations”, and implement policies to promote the virtuous cycle and healthy development of the real estate industry. The business management department of the central bank announced that the recently held 2022 Beijing monetary and credit work conference stressed the need to accurately grasp and implement the prudent management system of real estate finance. Adhere to the positioning of “houses are for living, not for speculation”, strengthen the expected guidance, support the reasonable financing needs of real estate enterprises, better meet the reasonable housing needs of buyers, increase housing rental financial support, and promote the virtuous circle and healthy development of the real estate industry. In addition, we should stick to the bottom line of sound development of compliant operation and effectively strengthen financial risk management and prevention. The Xiamen municipal government recently issued the regulations on the management of pre-sale of commercial housing in Xiamen. In terms of the supervision of pre-sale funds, it revised the “use before retention” to the “stay before use” supervision mode, making it clear that all the house purchase funds paid by the pre purchaser are pre-sale funds and should be deposited into the special account for the supervision of pre-sale funds. The new regulations will come into force on April 1, 2022. According to the government work report of the Ministry of housing and urban rural development in 2021, 53000 old urban communities have been reconstructed. According to the latest data disclosed by the Ministry of housing and urban rural development recently, after summarizing the statistics and reporting of various regions, 56000 old urban communities will be reconstructed in 2021.
At present, the valuation of the real estate sector is at a low level, with strong performance certainty and high dividends. We mainly recommend leading real estate enterprises with strong performance certainty China Vanke Co.Ltd(000002) , Poly Developments And Holdings Group Co.Ltd(600048) , Jinke Property Group Co.Ltd(000656) , Seazen Holdings Co.Ltd(601155) , Hangzhou Binjiang Real Estate Group Co.Ltd(002244) , Longguang group, Xuhui holding group, country garden, Baolong real estate and Country Garden Service in property management sector, China Merchants Property Operation & Service Co.Ltd(001914) , Xincheng Yue service, Xuhui Yongsheng service, New Dazheng Property Group Co.Ltd(002968) and Nacity Property Service Group Co.Ltd(603506) . Relevant beneficiary objects include Longhu group, China Jinmao, poly property, green city services, etc.
Risk tips
Sales were lower than expected, and the real estate regulation policy was tightened.
