HK Stock Market Move | The decline in Neibang stocks is at the forefront, and institutions predict that the performance of the real estate sector will continue to be under pressure in the first half of the year. The differentiation in performance between enterprises will intensify.

Property stocks in the Neighbourhood are leading the decline, as of the report, SINO-OCEAN GP (03377) fell by 5.17% to HK$0.11; R&F PROPERTIES (02777) fell by 5.36% to HK$1.06; SUNAC (01918) fell by 4.6% to HK$1.66; SEAZEN (01030) fell by 3.47% to HK$2.5. On the news front, data from the National Bureau of Statistics shows that from January to June, the national real estate development investment was 4.6658 trillion yuan, a year-on-year decrease of 11.2%; of which, residential investment was 3.577 trillion yuan, down 10.4%. From January to June, the sales area of new commercial housing was 458.51 million square meters, a year-on-year decrease of 3.5%; of which, the sales area of residential housing decreased by 3.7%. In addition, data from the National Bureau of Statistics shows that in June 2025, among 70 large and medium-sized cities, the selling prices of commercial residential housing in various cities decreased on a month-on-month basis, and the year-on-year decline continued to narrow. Shenwan Hongyuan Group released a research report stating that looking ahead to the first half of 2025's real estate sector performance, we believe that the sector's performance will continue to be under pressure, mainly due to: the continuous decline in sales since 2021 has led to a decrease in settlements; previous price cuts and promotions have pushed down current settlements and affected profit margins. However, considering the government's requirements for the real estate industry to "stabilize and recover" and companies reaching the bottom in terms of profit margins and asset writedowns, we expect the sector's performance to bottom out and weakly recover during 2025-2026, and performance differentiation among companies will further intensify.