Key investment points:
\u3000\u30001. Real estate investment: affected by the epidemic, real estate development investment fell significantly in April. Since this year, China's real estate investment has continued to show a downward trend. This trend has not changed in April, resulting in the first year-on-year contraction of the annual cumulative investment since 2021. At the same time, due to the poor sales of the real estate industry, the return of funds by real estate enterprises has been blocked. In the short term, the recovery of investment in the real estate industry may still need to further relax the policy on the demand side, so as to help stabilize the sales of real estate enterprises and alleviate the financial pressure of real estate enterprises.
In the land market, the willingness of real estate enterprises to acquire land was still low in April, and the cooling of the land market was significant, especially in first tier cities. There are two main reasons for speculation: one is that the epidemic in Shanghai and other places is more serious, which affects the progress of land trading activities; the other is that the general capital situation of real estate enterprises is still relatively tight recently, resulting in low ability and willingness to obtain land.
\u3000\u30002. Capital situation of the real estate industry: it is still difficult for real estate enterprises to raise loans, so they need to rely more on the return of funds from selling houses
In April this year, the capital situation of China's real estate enterprises was still relatively tight. On the one hand, due to the high debt level of many real estate enterprises, banks were more cautious in lending, and there were even cases of loan withdrawal, loan interruption and loan pressure. On the other hand, due to the epidemic and other reasons, the sales situation of real estate enterprises was poor, which hindered the payment collection of real estate enterprises.
As an important factor affecting the cost of house purchase, the interest rate of personal housing mortgage loan continued the downward trend in the first quarter of this year, which is consistent with the continuous reduction of housing loan interest rate in various places in recent months. At present, according to the policies of the central bank and the China Banking and Insurance Regulatory Commission, more cities may "implement policies according to the city" to adjust the local mortgage interest rate in the future.
\u3000\u30003. Sales in the real estate industry: the sales of new and second-hand houses continued to decline, and the epidemic had a great negative impact on the real estate market. The control measures of the epidemic have made the real estate sales in some areas almost stagnant. At the same time, the unemployment, income and expected income caused by the epidemic have also reduced the willingness and ability of residents to buy houses. We believe that after June, if local epidemic control measures can be reduced and local governments continue to introduce policies to relax restrictions on house purchase, the real estate market in the Yangtze River Delta and other areas seriously affected by the epidemic is expected to recover in the second half of the year.
