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Shares of Chinese property developers stage a strong rally in Hong Kong, with Longfor Group surging nearly 20%, KWG Group up 14.3%, Country Garden up 13.5%, Seazen Holdings up 13.4%.
In the A-share market, an index tracking the real estate sector compiled by Wind Information is surging more than 4%, making it the best-performing sector, compared to 1.5% gains for the benchmark Shanghai Composite Index. Developers including Jinke Property, Jiangsu Zhongnan Construction, Hua Yuan Property are surging by the daily limit of 10%.
China will make policy adjustments according to the major changes in the supply and demand in the real estate market, optimize real estate policy at an appropriate time, make a good use of city-based policy toolkit, better meet rigid and improvement-based housing demand and promote the steady and healthy development of the real estate market, the Politburo, the top decision-making body of China’s Communist Party, said at a policy meeting on Monday.
Notably, the Politburo meeting didn’t mention the phrase “housing is for living, not for speculation,” which had been the slogan for the country’s real estate regulation in the past few years.
Analysts believe that the expression indicates that the government will step up policy support for the real estate sector struggling in falling sales and prices.
The absence of any further mention of “housing for living, not for speculation”, which could potentially be bullish for the real estate sector, UBS said in a research note on Tuesday.
The most prominent move from the Politburo’s meeting was the pledge to adjust and optimize real estate policies in a timely manner, which should open the door for further property easing, however, the magnitude and duration of policy support for the real estate industry remains unclear, Citigroup said in a note.
