View of this month: the central government continued to release monetary easing signals such as interest rate reduction and five-year LPR reduction, and took multiple measures from the aspects of pre-sale capital supervision and issuance of M & A bills to alleviate the capital pressure of real estate enterprises; On the whole, the financing margin of real estate enterprises has warmed up, but the transaction in the real estate market is still weak. In January 2022, the sales of the top 100 real estate enterprises decreased by more than 40% month on month. The land acquisition real estate enterprises are still concentrated in the central state-owned enterprises or high-quality private enterprises with good credit qualifications. The sentiment of home buyers and the investment confidence of real estate enterprises need to be boosted and repaired. Considering that the short-term industry fundamentals are still under pressure and the policy game space is still, it is expected to drive the continuous repair of sector valuation; In the medium and long term, with the withdrawal of some real estate enterprises and M & A integration within real estate enterprises, the industry pattern is expected to be reshaped, and real estate enterprises with financing, control and product advantages are expected to stand out. In terms of development, focus on the leading real estate enterprises Poly Developments And Holdings Group Co.Ltd(600048) , Gemdale Corporation(600383) , China Merchants Shekou Industrial Zone Holdings Co.Ltd(001979) , China Vanke Co.Ltd(000002) with strong short-term pressure resistance and prominent medium and long-term competitive advantages, as well as the second-line elastic targets Jinke Property Group Co.Ltd(000656) , Seazen Holdings Co.Ltd(601155) and Longguang group benefiting from the improvement of policies. In terms of diversified business, the valuation of the property management sector has reached a historical low, the superimposed performance period is approaching, and the cost performance continues to highlight. We pay attention to high-quality property enterprise investment opportunities, such as country garden service, poly property, xinchengyue service, Jinke service, Xingsheng business, etc.
Policy: the capital side of real estate enterprises continues to be deregulated, and the frequent emergence of low-energy cities in the property market is good. In January, there were 26 housing related policies, including 5 tight policies and 9 loose policies. The frequency of housing related tight policies in a single month continued to be low. The central government has continued to release monetary easing signals, release pre-sale supervision funds and other measures to alleviate the financial pressure of real estate enterprises. Low-energy cities have frequently introduced favorable “market support” for house purchase, such as reducing the proportion of down payment, implementing “loan recognition but not house recognition”, and issuing house purchase subsidies. It is expected that the follow-up “urban measures” will continue to be performed.
The central bank will improve the “double door” financing ratio of Housing enterprises. In January, the growth rate of M2 increased by 0.8 percentage points month on month, and the year-on-year growth rate of social finance stock increased by 0.2 percentage points month on month. The overall social finance data was better than expected, and the five-year LPR fell for the first time in 21 months. However, the medium and long-term loans of residents increased by 227.2 billion yuan less than that in the same period in 2021, which also reflected the lack of willingness of residents to buy houses. Benefiting from the impact of supervision and care on the reasonable financing demand of real estate, in addition to the central state-owned enterprises, Jinke, Binjiang and other high-quality private enterprises have successively issued domestic bonds, and real estate financing shows signs of marginal recovery.
Property market: sales slowed down, transactions were weak, and the Spring Festival “home ownership” broke the appointment. In January, the average monthly daily turnover of new houses in key 50 cities decreased by 25.8% month on month, and the average monthly daily turnover of second-hand houses in key 20 cities decreased by 15.3% month on month. Affected by factors such as the end of the performance sprint period, repeated epidemics and poor decontamination, the enthusiasm of real estate enterprises to push the market is generally not high. The average approved listing area of commercial houses in 35 cities decreased by 46.1% month on month in January, which also inhibited the formation of transactions. Despite frequent policy warm winds, the confidence of home buyers has declined, the sales side has continued to be weak, the inventory and clearing cycle have shown a cumulative upward trend, and the “home ownership” of the Spring Festival is also lower than that of previous years.
Local market: the volume and price of “local auction vacuum period” fell, and it is difficult to be optimistic in 2022h1. January was the “vacuum period of land auction”, and the average transaction price of land in 100 cities decreased by 63.2% and 54.7% month on month. Looking forward to the 2022h1 local auction, in view of the liquidity pressure of real estate enterprises, it is expected that the 2022h1 local auction market may be difficult to be optimistic. In cities with better fundamentals and more attractive land auction rules, the land market is expected to recover first. However, it is expected that the phenomenon of supporting the bottom of central state-owned enterprises and local urban investment in most cities will continue. Subsequently, under the background of increasing financial pressure, it is not ruled out that local governments will further transfer profits in terms of land transfer quality, payment of land transfer price, land price and house price.
Real estate enterprises: the sales of the top 100 real estate enterprises decreased by more than 40% month on month, and high-quality real estate enterprises are the main force to obtain land. The sales of the top 100 real estate enterprises in 2021 was the first negative growth in nearly five years. In January 2022, the full caliber sales amount and full caliber sales area in a single month decreased by 40.7% and 44.4% year-on-year, 46.9% and 47.1% month on month. Looking back, the transaction in February still faces a big test; The sales volume ratio and area ratio of land acquisition of the top 50 real estate enterprises decreased by 7.4pct and 3.1pct month on month. The land acquisition real estate enterprises are central state-owned enterprises or high-quality private enterprises with stable finance and good credit qualification. It is expected that the 2022h1 local auction market will still be a “hunting ground” for central state-owned enterprises and high-quality private enterprises.
Sector performance: in January, Shenwan real estate sector fell 1.29%, outperforming Shanghai and Shenzhen 300 (- 7.62%); At present, the PE (TTM) of the real estate sector is 8.48 times, and the valuation is in the quantile of 21.7% in recent five years.
Risk tips: 1) if the subsequent supply of goods is impacted due to insufficient new soil storage, it will have a negative impact on the sales, commencement and investment of the industry; 2) If the pressure of property market deregulation exceeds expectations and sales continue to exchange price for volume, it will bring some early high price impairment risk; 3) Policy care is limited, and the adjustment range and time of the industry exceed expectations, which will have a negative impact on the development of the industry.
