The real estate sector, which is still in the "cold winter", is blowing with warm wind.
After the central bank and the China Banking and Insurance Regulatory Commission announced on May 15 that they would lower the lower limit of the first mortgage interest rate by 20 basis points, on May 20, the five-year LPR would be lowered again within the year, and the lower limit of the individual first mortgage interest rate could be as low as 4.25%. For the real estate industry, the easing of policy is becoming stronger and stronger.
however, the real estate market is still in a relatively sluggish state, and there is also great operating pressure on real estate enterprises. The recovery of the real estate market still needs to be strengthened in many ways. However, from the perspective of investment, under the background of "stable growth", the real estate sector is relatively strong in this year's volatile market. As of May 20, the Shenwan real estate index fell by 2.86% during the year, ranking third among the 31 Shenwan industries, while the Shanghai stock index and Shanghai Shenzhen 300 fell by 13.55% and 17.46% respectively in the same period
It is worth noting that most of the better performing active equity funds have focused on the real estate sector since this year. Some fund managers pointed out that this round of investment opportunities in the real estate industry may last for two or three years, rather than there will be no opportunities after the end of the short-term policy game.
real estate may benefit from the 5-year LPR reduction
On the morning of May 20, the people's Bank of China authorized the national interbank lending center to announce that the one-year LPR remained unchanged at 3.7%, and the five-year LPR was reduced from 4.6% to 4.45%, with a reduction range of 15 basis points.
In this regard, Li Heng, fund manager of ChuangJin Hexin, said that in combination with the central bank's cut in the interest rate (LPR) on May 20 and the central bank's announcement on May 15 to cut the lower limit of the interest rate on commercial personal housing loans for the first house to no less than 20 basis points, the two recent actions of the central bank have two important effects: on the one hand, from the historical data, real estate sales are very sensitive to interest rates, which is expected to effectively promote the bottom of real estate sales; On the other hand, the above action of the central bank is to adjust the real estate financial policy at the national level. Its signal is conducive to enhancing residents' confidence and promoting the recovery of sales.
Li Ying judged that the rapid downward phase of real estate sales may end, and the sales expectation is expected to be improved. The stabilization of the real estate industry may lead to the improvement of social finance, so as to drive the A-share market into the stage of continuous sector opportunities. However, at the same time, it is still necessary to continue to observe the impact of population structure, epidemic situation and other factors on the rebound of real estate sales.
It is expected that the market will gradually recover in the second half of the year with the loose policy of the real estate research sector, and the market is expected to gradually recover in the second half of the year.
year high performing fund managers oversubscribed real estate
it is worth noting that most of the better performing active equity funds have focused on the real estate sector since this year
For example, 10000 macro timing and Multi Strategy funds with a return of more than 30% in the year, as of the end of the first quarter, the top ten heavyweight stocks included Poly Developments And Holdings Group Co.Ltd(600048) , Gemdale Corporation(600383) , China Vanke Co.Ltd(000002) , Seazen Holdings Co.Ltd(601155) and other real estate stocks, accounting for nearly 30% in total.
Huang Hai, deputy general manager and investment director of Wanjia fund, its fund manager, said that since the third quarter of last year, the economy has begun to face certain growth pressure, and the market has always had high expectations for steady growth, and the pricing of potential economic downside risks is not sufficient. Taking real estate as an example, we were very optimistic about the opportunities of the real estate sector at that time, mainly based on: 1) the probability of loosening the real estate regulation policy increased. From the perspective of stabilizing land price, house price and expectation, the probability of moderately easing the real estate policy increased significantly. The real estate sector has been greatly affected by the policy. If the policy environment gradually changes from tight to loose, the valuation of real estate stocks will be significantly repaired. 2) The problem of low profit margin of land acquisition by developers is being repaired. Since the fourth quarter of 2021, the profit margin of land acquisition by real estate enterprises has improved significantly. 3) From the medium and long-term perspective, the leading financial risk of the real estate industry is low, with the characteristics of steady growth in the future, high dividend rate and accelerated increase in market share, which is worthy of the attention of long-term funds.
In addition, Qiu Dongrong of Zhonggeng fund and Jiang Cheng of Zhongtai Asset Management Co., Ltd., who had better performance in management products during the year, also increased their positions in the real estate sector in the first quarter, Gemdale Corporation(600383) , China Vanke Co.Ltd(000002) respectively entered the top ten heavyweight stocks of Zhonggeng value pilot mix and Zhongtai Yuheng value optimization.
It is worth noting that the above-mentioned fund managers are the leading stocks in the industry. In this regard, Huang Hai said that according to the statistics of Shenwan Hongyuan Group Co.Ltd(000166) securities, the overall net profit of the real estate sector in 2021 was - 91.8% year-on-year. Among them, the net profit of first-line real estate enterprises was - 30.5% year-on-year; The net profit of second tier real estate enterprises was - 206.1% year-on-year; The net profit of third tier real estate enterprises was - 112.9% year-on-year. The difference of this round of real estate cycle is that there is a great differentiation among enterprises. For developers who used to rely on blind leverage, the damage in this round is obvious, and they may never return to their previous state in the future. Their performance is basically declining sharply, or even losing money. We have avoided this kind of target in our investment. However, like some steady leading enterprises, the sales and performance are far better than the industry average. Although some enterprises also have a decline in performance due to the provision of more asset impairment and other reasons, the range is controllable. In the future, we judge that such enterprises will resume the growth trend.
this round of investment opportunities in real estate stocks may last for two or three years
At present, some fund managers have clearly stated that the investment opportunities in the current round of real estate industry may last for two or three years, rather than there will be no opportunities after the end of the short-term policy game.
Zou Xi, deputy general manager of "veteran" financing fund and director of equity investment, who focuses on cyclical stock investment, recently expressed his optimism about the investment in the real estate sector. He said that he has been heavily involved in real estate since the third quarter of last year because he saw that the real estate industry has entered a major moment. First, it has a downward trend, which is very different from the cycle in history. It is a downward trend with the nature of market clearing, Many real estate companies may leave this market, or even go bankrupt, so it is bound to change the past fast turnover mode and constantly push up the land price. In addition, for five consecutive years after 2010, real estate investment has been at a relatively high level. By the third quarter of last year, there was an obvious downward trend in real estate investment, and the downward trend is difficult to stop. At this time, the policy repression that has not been friendly to the real estate market in the past four or five years may be gradually relaxed.
Zou Xi said that this round of real estate market is divided into three stages. The first stage must be dominated by leading state-owned enterprises and central enterprises, and the market share can continue to increase. In the second stage, some high-quality private enterprises and even some second tier state-owned enterprises may be more flexible, but at this stage, the leading companies are also very stable and sustainable. At present, they are roughly in the second stage. The third stage later is that most companies in the industry work together to improve the valuation. "The sustainability of this round of investment opportunities in the real estate industry may be two to three years. The future space is not what you imagine. There will be no opportunity after the game. We need to redefine the space of the real estate industry in the new development stage."
Another fund manager said that the current real estate is equivalent to Baijiu in 2015. Huaya fund manager Li Yan believes that the real estate industry, as the ballast of the whole economy, the upstream and downstream industrial chain + real estate industry accounts for more than 30% of the total GDP stock. Under the current epidemic pressure, in fact, this has played a vital role in the real estate industry and stabilizing the economy. It is expected that the supply side reform of the whole real estate market will continue, and the demand side policies will continue to be introduced.
"I personally believe that investors have extended the investment dimension to one or three years. From last December, standing at the time point and at the end of March this year, the investment value of this industry is still very prominent." Li Yan said.
