China - Housing 06 (Nov 21 - Dec 26)

[winston]

China Property Sector: Signs of physical market bottoming

National sales in Aug in line; showing signs of physical market bottoming

Expects a moderate pickup in 4Q22 alongside an anticipated pickup in project launches and potential introduction of more policy support

Stay with quality names for potential rebound: CR Land (1109 HK), COLI (688 HK), and Yuexiu (123 HK)

We like KE Holdings (BEKE US/2423 HK), beneficiary from demand shift to secondary market

Source: DBS

[behappyalways]

China's "Zombie" Housing Market Could Persist Due To Lack Of Marriages
https://www.zerohedge.com/markets/china ... es-country

[winston]

CN Reportedly Asks State-owned Banks to Provide At Least RMB600B Funding to Property Sector

China has asked the country's state-owned banks to provide at least RMB600 billion worth of financing to the beleaguered property sector within this year, as the Chinese government seeks to address a deteriorating liquidity crisis surrounding homebuilders, reported Bloomberg News, citing sources.

Source: AAStocks Financial News

[winston]

China’s bursting housing bubble to rock the economy for a long time

While many economists said China’s crippling housing downturn won’t get much worse and that the stimulus will kick in this year or next, the reality on the ground for sellers is much bleaker.

Consumer confidence is near a record low, and a recent central bank survey showed 73% of households expect property prices to stay unchanged or drop in the near term.

Estimates are ranging from US$2.4 trillion (RM11 trillion) for the new-home market to US$52 trillion (RM244 trillion) for existing inventory.

Real estate accounts for about a quarter of domestic output and almost 40% of household assets.

Told the biggest state-owned banks to extend at least 600 billion yuan (RM392bil) of financing to the industry.

Endured endless pain in the last 18 months.

A wave of more than US$50bil (RM234bil) in dollar bond defaults.

Source: Bloomberg

https://www.thestar.com.my/business/bus ... -long-time

[winston]

China property stocks rise after easing of share financing rules

CSRC will allow certain companies with small property interests to raise money by selling A-shares, but the proceeds cannot be invested in the real estate business.

For eligible companies, real estate must not be their core business and should not contribute more than 10 percent of their profit.

China has barred its property firms or property-related firms from financing via the domestic A-share market since end-2018, including both IPOs and additional or follow-up share sales.

Real estate accounts for around 40 percent of household assets and makes up around a quarter of the country's gross domestic product, the largest among all sectors.

Source: Reuters

https://www.thestandard.com.hk/breaking ... ules%C2%A0

[winston]

China home sales drop 28% as Covid flare-up adds to risks

Chinese authorities have eased home ownership rules, trimmed interest rates and urged banks to step up lending.

Source: Bloomberg

https://www.businesstimes.com.sg/real-e ... s-to-risks

[winston]

China property crisis threatens US$1.6t of local state debt

CHINA’S deepening property crisis is piling pressure on a US$1.6 trillion corner of the country’s onshore bond market, as cities and local administrations step in as white knights to bail out troubled developers in a state-backed bid to aid the sector.

A potential default could cause another convulsion in a market, where LGFVs’ 11.6 trillion yuan (S$2.2 trillion) of notes account for about a third of China’s local corporate bonds.

Source: Bloomberg

https://www.businesstimes.com.sg/global ... state-debt

[winston]

China plans to rescue property firms in strongest sign yet that policymakers are easing a years-long clampdown on sector

People’s Bank of China and China Banking and Insurance Regulatory Commission have jointly issued a notice to financial institutions laying out plans to ensure the ‘stable and healthy development’ of the sector, sources say

Authorities have sought to defuse the property crisis with a raft of measures in the past few months

Includes 16 measures that range from addressing the liquidity crisis faced by developers to loosening down-payment requirements for homebuyers

Source: Bloomberg

https://www.scmp.com/business/article/3 ... -clampdown

[winston]

China lets developers access pre-sale funds to ease cash crunch

China will give "quality" property developers access to as much as 30% of the pre-sale funds with letters of guarantee from banks. The funds are money that homebuyers have paid to developers in advance of their property being built, and is generally held in an escrow account.

Any funds which are withdrawn should not be used to buy land, make new investments or repay money borrowed from shareholders. The money should primarily be used to pay for construction of projects and to repay due debts for specific projects.

Only developers that are better off are more likely to get the banks' consent to access pre-sale funds. "It's still going to be voluntary rather than mandatory for the banks."

Source: Bloomberg

https://www.theedgemarkets.com/article/ ... ash-crunch

[winston]

China's home prices see biggest decline in seven years

New home prices slumped 1.6 percent year-on-year after a 1.5 percent fall in September.

They are not targeting weakening demand and think the recovery is likely to be bumpy, as evidenced by downbeat property figures earlier this week.

Source: Reuters

https://www.thestandard.com.hk/breaking ... ears%C2%A0