This week’s view: this week, the central bank cut interest rates, and the LPR interest rates for more than five years fell for the first time in 21 months. Weak level cities such as Zigong and Yantai issued property market deregulation policies, involving easing loan restrictions and pre-sale fund supervision. Subsequently, under the background of urban implementation, there is still room for policy fine-tuning in some areas under supply and demand pressure. The Ministry of housing and urban rural development announced that it plans to build 2.4 million affordable rental housing units in 2022. As the first city in China, Shanghai has issued supporting documents for affordable rental housing such as “project identification measures” and “lease management measures”. The pace of follow-up affordable housing construction is expected to accelerate, and the relevant supporting documents will be implemented gradually. In terms of investment suggestions, the short-term industry fundamentals are still under pressure, and there is still room for policy game, which is expected to drive the continuous repair of sector valuation; In the medium and long term, as the painful period of the industry continues, some real estate enterprises withdraw and merge and integrate 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, pay attention to 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, and moderately pay attention to the second-line elastic targets Jinke Property Group Co.Ltd(000656) , Seazen Holdings Co.Ltd(601155) , Jiangsu Zhongnan Construction Group Co.Ltd(000961) , Longguang group, etc. benefiting from the improvement of policies. In terms of diversified business, the current valuation of the property management sector has reached a historical position, and the cost performance continues to highlight. It is optimistic about the property management leaders with outstanding comprehensive strength, such as country garden service, poly property, xinchengyue service, Jinke service, and commercial operators with strong asset light output strength, such as Xingsheng commerce.
Policy environment monitoring: 1) the Ministry of housing and urban rural development and Shanghai: 2.4 million affordable rental housing units were built throughout the year, and Shanghai issued supporting documents for affordable rental housing; 2) Central and local governments: the central bank cut interest rates and cut LPR interest rates, and many places frequently showed the signal of deregulation of the property market
Market operation monitoring: 1) the turnover decreased month on month, and it is expected to decline steadily. With the elimination of the lag in the filing of new year’s Day holiday, 40000 new houses and 14000 second-hand houses were sold this week (1.15-1.21), down 13.4% and 9.6% month on month. With the completion of the year-end sprint of real estate enterprises, the transaction in January is expected to be lower than that in December, and the transaction in a single week is expected to be stable. 2) The proportion of improved demand increased month on month. In the transaction of commercial houses in 32 cities in December 2021, the number of units above 90 square meters increased by 2.2pct to 77.4% month on month. 3) Inventories fell slightly month on month, and were relatively stable in the short term. The inventory in 16 cities was 102.06 million square meters, down 0.2% month on month. The inventory may be relatively stable under the pressure of slowing down short-term supply and deregulation. 4) Land transactions fell, the premium rate was flat, and the proportion of the second tier increased. Last week, the land supply and construction area of Baicheng was 4.865 million square meters and the transaction construction area was 4.779 million square meters, with a month on month decrease of 34% and 11%; The transaction premium rate was 1%, unchanged month on month. Among them, the first, second and third tier transactions accounted for 9%, 43.4% and 47.6% respectively, with a month on month decrease of 2.9pct, an increase of 23pct and a decrease of 20.1pct respectively.
Capital market monitoring: 1) real estate bonds: this week, domestic real estate enterprises issued bonds of 2.6 billion yuan, a month on month decrease of 7.02 billion yuan, and overseas bonds of 138 million US dollars, a month on month decrease of 110 million US dollars. 2) Trust: collective trust issued 2.12 billion yuan this week, down 2.37 billion yuan month on month. 3) Real estate stocks: the real estate sector rose 2.22% this week, outperforming Shanghai and Shenzhen 300 (1.11%); At present, the PE (TTM) of the real estate sector is 8.6 times, and the valuation is in the quantile of 23.3% in recent five years. This week, the net capital inflow of Shanghai, Shenzhen and Hong Kong stocks to the North was China Vanke Co.Ltd(000002) , Poly Developments And Holdings Group Co.Ltd(600048) , Hangzhou Binjiang Real Estate Group Co.Ltd(002244) ; The top three real estate enterprises with net capital inflow from South are rongchuang China, country garden service and China overseas development.
Risk tips: 1) supply adequacy reduces risk; 2) Large scale impairment risk of real estate enterprises; 3) Policy care is less than expected risk.
