HK Stock Market Move | The stock of Nefang continues to decline. S&P says this year's new home sales have fallen more than expected. The performance of real estate enterprises in the third quarter will continue to be under pressure.

The stock prices of domestic real estate companies continue to decline. As of the time of writing, RONSHINECHINA (03301) fell by 6.25% to HKD 0.18, SUNAC (01918) fell by 3.13% to HKD 1.55, R&F PROPERTIES (02777) fell by 3.03% to HKD 0.64, and SEAZEN (01030) fell by 2.94% to HKD 2.31. Standard & Poor's released a report stating that it is expected that new home sales in China will decrease by 8% year-on-year to RMB 8 trillion to 9 trillion this year, a much larger decline than the 3% forecast in May. Standard & Poor's believes that if demand can stabilize in first-tier cities first, it will help sustainably revive demand. Currently, it is expected that sales will decrease by another 6% to 7% next year, and prices of new homes will drop by 1.5% to 2.5%. Shenwan Hongyuan Group predicts that the performance of real estate companies will continue to be under pressure in the third quarter, mainly due to the continuous decline in sales since 2021 leading to a decrease in settlements; previous price reductions and promotions have reduced profitability. However, considering the government's requirement for the real estate industry to "stabilize" and the bottoming out of corporate profit margins, as well as impairment clearing, it is expected that the sector's performance in 2025-2026 will see a weak recovery at the bottom, and the differentiation of performance among companies will further intensify.