China - Housing 01 (May 08 - May 10)

[LenaHuat]

Prompted by MM's avatar (wonder if it has anything to do with my previous post about 搶破頭) and what I had just seen on TV, I'm posting this hot video :-
房奴国际歌

[winston]

Not vested. And it's a funny feeling when the "experts" continue to ask you to buy after they have run up 200% to 400% in a few months ..

DJ MARKET TALK: CS Keeps Overweight Call On Mainland Developers

1510 [Dow Jones] Credit Suisse notes confusion in HK market about Beijing's policy intention toward property market, but "it is clear to us that all favorable policies related to the primary housing market remain intact."

Thinks business tax exemption in secondary market for 2009 never been positive factor for primary market, if not negative factor, thus expiration of business tax exemption should be positive to primary housing market.

Since almost all earnings of Chinese property developers, agencies are from primary market, "we view this policy change as a positive sign for the sector;" doesn't expect any more meaningful policy changes in near term, keeps Overweight stance on sector. C

Source: Dow Jones Newswire

[winston]

Not vested. Are they saying that it's not volatile now ? Noise ..

DJ MARKET TALK: China Property Stocks Tipped Volatile In 2010 -CS

1205 [Dow Jones] Credit Suisse says China property will continue to be "a difficult sector to call" given government knows it's one of most important economic drivers, while Beijing will also want to prevent formation of any bubble.

"It may end up being a sector that delivers more volatility than relative returns in 2010," CS says; stills like sub-sectors like property agents more than developers; among developers, prefers those with more diversified geographical exposure.

Developer stocks mostly lower amid HSI's 1.3% decline; China Overseas Land (0688.HK) down 0.1% at HK$18.00; Shimao Property (0813.HK) off 2.7% at HK$16.14; Sino-Ocean Land (3377.HK) down 1.7% at HK$8.06.

Source: Dow Jones Newswire

[winston]

Not vested. From UOBKH:-

More policies ahead. Yesterday, the State Council held a conference on property policy. The central government issued a warning to curb the surge in property prices of major cities. The government also reiterated that it would increase land and housing supply and expand the scale on subsidised housing construction.

Nonetheless, in our view, the reiteration on the increase in supply seems to be not so effective to curb the housing price based on experience over the past few years.

This is mainly due to:
a) the scarcity of land in major cities,
b) time lag from the increase of land supply to housing supply and
c) more importantly, the lack of implementation on policies against landbank and housing hoarding in China.

In our view, to curb the housing demand is more effective than increase the supply in the mid- to short-term. As a result, we expect more supportive policy cancellations likely in the first half of next year. If the asset prices, particularly the property prices continue to surge, we cannot rule out the possibility for the government to hike the interest rate earlier than expected.

Apart from business tax, we would like to remind investors to pay attention to two policies in Shanghai which will cease at yearend:
a) exemption on personal income tax for the sale of self-use houses held for more than two years and
b) a 20% downpayment on public housing fund loan as well as upper limit for public housing loan revised up to Rmb300,000 from Rmb200,000 per person.

We are not sure whether the Shanghai government will renew the policies at the moment. Our stock picks remain Yanlord (YLLG SP/BUY/Target: S$2.74), Sino-Ocean (3377 HK/BUY/Target: HK$10.16) and Poly HK (119 HK/BUY/Target: HK$12.67) and top SELL is Greentown (3900 HK/SELL/Fair: HK$8.44).

[kennynah]

b) a 20% downpayment on public housing fund loan as well as upper limit for public housing loan revised up to Rmb300,000 from Rmb200,000 per person.

this should be effective in curbing demand..

[winston]

Not vested.

DJ MARKET TALK: Mainland Developers Hammered; Stay Away - Kim Eng

1523 [Dow Jones] HK-listed mainland developers still mired in policy woes, with big names falling 3%-6% on news Beijing vows to curb rapid property price rises. Kim Eng notes this follows increase in downpayment ratio, mortgage interest rate announced October, resumption of 5.5% sales tax for secondary property transactions earlier this month, with "the tone on this round of fine-tuning is stronger than the previous two rounds."

Expects increasing chances of additional measures in short term; advises investors to stay away from China property developer sector in short run.

China Overseas Land (0688.HK) down 5.1% at HK$17.40, Shimao Property (0813.HK) off 5.3% at HK$15.74, Guangzhou Investment (0123.HK) down 7.1% at HK$2.37

Source: Dow Jones Newswire

[LenaHuat]

有的理论家觉悟不如千年前的杜甫

　　贺铿：社会资金炒房，他买房不是为了住，而是为了再转手，再赚钱，所以有的有钱人一买不是一套两套，是十套二十套，他买到这里压根是不住的，等到有个好价钱我卖了。

　　记者：您这个判断的依据从哪儿来？

　　贺铿：许多都做过调查，北京好多房子一开盘的话，都是跑去买十套二十套不是稀奇事。我们作为一个民生产业，应该是让更多的人买得起房才对。我说我们现在有一些商人，有一些理论家，我说得很刻薄，我说还不如一千多年前诗人杜甫的观点。诗人杜甫他把房地产的性质说得非常的清楚，干什么的？安得广厦千万间，大庇天下寒士俱欢颜。是盖房子给寒士们住的，要让大多数人买得起房子这才是正道。

副部级官员自称买不起房 政府炒地促房价攀升

[winston]

China’s Worst-Performing Property Stocks to Rebound, CLSA Says

Dec. 16 (Bloomberg) -- China’s property stocks, the worst performers this quarter, will rebound because policy changes are “factored into” shares and the government needs the industry to bolster consumer spending, CLSA Asia-Pacific Markets said.

The China Se Shang Property Index of real estate shares fell the most in two weeks yesterday, led by the largest developers China Vanke Co. and Poly Real Estate Group Co., after the Xinhua News Agency reported the government will target “excessive” growth in property prices in some cities. That follows the cabinet’s statement last week that it will re-impose a sales tax on homes sold within five years, after cutting the period to two years in January.

“The market has more or less factored in policy risk” as property shares have lagged behind the benchmark index in the past three months, said Manop Sangiambut, Shanghai-based head of China A-share research at CLSA, which was voted best in overall research in Asia excluding Australia and Japan by Asiamoney magazine. “The overall property market remains quite healthy.”

Sangiambut, who has an “overweight” recommendation on Chinese mainland-traded property stocks, didn’t disclose his recommendations. He predicts the CSI 300 Index, which measures exchanges in Shanghai and Shenzhen, will rise to 4,400 next year, a 23 percent gain from yesterday’s close of 3,583.34.

“China’s stocks represent value at current levels,” he said. The property index tracking 33 companies has declined 2.4 percent in the past three months, compared with the 7.9 percent advance in the benchmark Shanghai Composite. The real estate gauge trades at 32 times profit, below the Shanghai index’s 34.7 times and this year’s high of 43 in July, according to weekly data compiled by Bloomberg.

Analysts say that the recent property measures are attempts by the government to clamp down on real estate speculation while sustaining a recovery in the world’s third-largest economy.

‘Heavy Handed’

China isn’t likely to adopt “heavy-handed policy measures” next year as “any sharp correction in the property market may hamper overall economic growth,” Fitch Ratings wrote in a report yesterday.

Property Stocks

Andrew Mattock, who manages the $342 million Henderson Horizon China Fund, said this week he will stay “fairly aggressive” on property stocks because tightening risks are priced in. Dreyfus Greater China Fund manager Hugh Simon said Dec. 11 that he won’t be adding to his real estate holdings after the Shanghai property index jumped 121 percent this year.

“Developers are doing well this year in terms of earnings but that will change because of the government crackdown,” said Zhang Ling, who helps oversee about $7.21 billion at ICBC Credit Suisse Asset Management Co. in Beijing.

RBC Capital Markets said Dec. 11 that a recovery in exports and a pick-up in inflation will force the Chinese central bank to increase interest rates in the first quarter of 2010.

Home prices climbed last month at the fastest pace since July 2008, adding to concern that record lending may fuel unsustainable asset-price increases. In Shanghai, the average home price rose to a record 22,270 yuan per square meter last week, the Shanghai Daily reported yesterday, citing Shanghai Uwin Real Estate Information Services Co.

China may impose property taxes on large and luxury homes, and curb purchases of real estate by foreigners, the Oriental Morning Post newspaper reported yesterday, citing a researcher at E-house China R&D Institute. The China Securities Regulatory Commission has asked eight property developers, including Shenzhen-based Vanke, to provide information on their capital flows, according to a separate report in the newspaper.

The government is unlikely to scrap preferential lending rates for buyers of second homes, introduced in December 2008, as China “still needs a strong property market to boost consumption,” said CLSA’s Sangiambut.

http://www.bloomberg.com/apps/news?pid= ... Zsy1f9AboM

[winston]

Not vested.

DJ MARKET TALK: Mainland Developers Down; "Buy Strong Players"

1035 [Dow Jones] HK-listed mainland property stocks underperforming for 2nd day, on concerns over more government measures to rein in rising property prices. While near-term selling pressure likely, DBS Vickers suggests investors "buy strong players on share price weakness"; favors developers with strong tier-II city or western China exposure as China exerts more efforts to promote housing demand in these cities;

These include Shimao Property (0813.HK), Shui On Land (0272.HK), China Resources Land (1109.HK), China Overseas Land (0688.HK). Shimao down 2.4% at HK$15.34, now off 13.8% vs 52-week high of HK$17.80 hit earlier this month; CR Land down 3.1% at HK$18.20. HSI last flat.

Source: Dow Jones Newswire

[mrEngineer]

China’s Worst-Performing Property Stocks to Rebound, CLSA Says

Dec. 16 (Bloomberg) -- China’s property stocks, the worst performers this quarter, will rebound because policy changes are “factored into” shares and the government needs the industry to bolster consumer spending, CLSA Asia-Pacific Markets said.

http://www.bloomberg.com/apps/news?pid= ... Zsy1f9AboM

how do you price policy risk to calculate the fair values? use binominal distribution + monte carlo? lol. When a bubble bursts, no quantitative analysis can lead to meaningful predictions..