In February, the sales decline of the top 100 real estate enterprises continued to expand, and the performance of real estate enterprises was similar to that at the beginning of the outbreak two years ago. In February 2022, the top 100 real estate enterprises achieved a full-scale sales amount of about 463.5 billion yuan, a decrease of 46.5% compared with the same period last year, an increase of 5.8 percentage points compared with January 2022; There are only nine developers with a monthly sales amount of more than 10 billion, which is close to the level of February 2019 and February 2020. February 2020 coincides with the first outbreak of covid-19 in China. We believe that the market’s downward expectation is difficult to change in the short term, and it will take time for the spontaneous recovery. It is expected that the sales in the second quarter will continue to be in the downward channel.
In February, the decline in the transaction area of new houses and second-hand houses in key cities narrowed. In February, the transaction area of first-hand houses in key cities increased by – 36.2% year-on-year, an increase of 25.7 percentage points over the previous month. Among them, the year-on-year growth rates of the transaction area of the first tier (4 cities), the second tier (17 cities) and the third tier (30 cities) in February were – 6.5%, – 32.7% and – 52.4% respectively, and the growth rates were + 49.3pct, + 24.2pct and + 18.4pct respectively compared with the previous month. In terms of second-hand housing, the transaction area of the 13 cities we tracked decreased by 51.5% year-on-year, 10.9 percentage points lower than that of the previous month.
In February, the financing scale of real estate enterprises hit a new low since January 2018, and the trend of rating reduction continued. (1) In terms of equity financing, the scale of equity financing in the industry decreased from 6.62 billion yuan last month to 323 million yuan in February 2022; (2) In terms of bond financing, the financing scale of the industry in February 2022 hit a new low since January 2018, of which the scale of domestic bond financing decreased by 13.2% to 30.12 billion yuan month on month, and the scale of overseas bond financing decreased by 78.7% to 3.09 billion yuan month on month; (3) In February, the issuing interest rates of domestic corporate bonds, short-term financing, medium-term notes and directional instruments of real estate enterprises were 4.2%, 2.8%, 3.4% and 3.80% respectively, and the issuing interest rate of overseas bonds was 8.6%, which continued the downward trend; (4) In that month, 152 real estate trust products were established, raising 18.24 billion yuan, an increase of 67.5% month on month; (5) The tide of rating downgrades continued, and a total of 15 mainstream real estate enterprises’ credit ratings or prospects were downgraded 23 times.
We reiterate our view that 2022q1 is the best configuration window for the real estate sector. There will be an obvious situation in the market performance that the company alpha is more important than the industry beta, and some high-quality companies will stand out. The credit development or operation ability of real estate enterprises is prominent. In addition, successful developers in diversified transformation also deserve attention. A share recommended by a developer for a share recommended by a developer: a share recommended by a developer: a share recommended by a developer for a share of a share: followinga series of a series of a series of a series of a series of a series of a series of a series of a series of a series of a series of a series of a shares: followinga series of a recommended by a developer: a share of a share recommended by a developer for a developer to recommend a share of a share recommended by a developer: followinga series of a series of a series of a series of a number of a series of a series of a series of a series of a series of the (a) the; Hong Kong stocks: China overseas development, China Resources Land, Longhu group and Xuhui holding group. A shares recommended by property management: China Merchants Property Operation & Service Co.Ltd(001914) , New Dazheng Property Group Co.Ltd(002968) ; Hong Kong stocks: Country Garden service, poly property, Xuhui Yongsheng service, China Resources Vientiane life. Green City Management Holdings is recommended by the agent construction standard.
Risk tip: the decline of industry sales exceeded expectations, resulting in increased risk of cash flow collection of real estate companies; The industry’s financing repair is not expected, resulting in increased pressure on completion and cash flow of the industry.
