Zhongjin: The year-on-year decline in March's new home sales narrowed, and the supply side of the second-hand housing market in core cities performed better than the same period last year.

Zhongjin released a research report stating that the year-on-year decline in new home sales in March has narrowed. From the supply side, due to seasonal factors, the listing volume of second-hand homes in 130 cities increased by 0.9% month-on-month in March, with Beijing and Shanghai seeing a 0.3% increase in listing volume. Although the listing volume has marginally increased, the speed is significantly slower than the same period last year (+2.0%). It is necessary to continue monitoring the changes in the balance of power between buyers and sellers in core cities in the future. With positive changes in the supply side and marginal efforts on the policy side, the turning point in housing prices in Beijing and Shanghai is gradually approaching. If the trend of structural optimization of supply and demand in early spring continues, it will further enhance the certainty of stable local housing prices, and real estate stocks may gradually enter a beta market. Zhongjin's main points are as follows: The year-on-year decline in new home sales in March narrowed, and the second-hand housing transactions were active; the supply side performance of the second-hand housing market in core cities was better than the same period last year. In terms of new homes, in March, the year-on-year decline in the sales area and amount of newly built commercial housing nationwide narrowed to -7.4% and -13.3% (compared to -13.5% and -20.2% in January-February), and the year-on-year decline in the sales area according to the high-frequency recording method also narrowed to -17% (compared to -33% in January-February); for second-hand homes, the year-on-year decline in the transaction area according to the high-frequency recording method in March decreased by 14% (compared to -3% in January-February), but the weekly sales volume at the end of March was 24% higher than the January average. Overall, it is estimated that the year-on-year decline in total sales of new and second-hand homes in March and the first quarter was about 10%, a significant narrowing compared to the fourth quarter of 2025 (about 30%). In addition, from the supply side, due to seasonal factors, the listing volume of second-hand homes in 130 cities increased by 0.9% month-on-month in March (cumulative month-on-month in January-February -0.2%), with Beijing and Shanghai showing a 0.3% month-on-month increase in listing volume (cumulative month-on-month in January-February -7.3%). Although the listing volume has marginally increased, the speed is significantly slower than the same period last year (+2.0%), and it is necessary to continue monitoring the changes in the balance of power between buyers and sellers in core cities in the future. The year-on-year decline in real estate investment in March was largely consistent with the previous month, and the year-on-year decline in land transaction volume narrowed slightly. In March, real estate investment decreased by 11.3% year-on-year (compared to -11.1% in January-February). Specifically, the year-on-year decline in construction area of houses at the end of March was consistent with the end of the previous month (11.7% at the end of February); the year-on-year decline in the built-up area and amount of land transactions according to the high-frequency method in March narrowed slightly (12% and -35% in March compared to 32% and -48% in January-February); and the year-on-year decline in new construction and completed area of houses in March also narrowed (17% in March compared to 23% in January-February for new construction, and 19% in March compared to 28% in January-February for completed construction). Due to the impact of weak domestic loans, the year-on-year decline in funds available to real estate companies in March slightly widened to -19% (compared to -16% in January-February), but the year-on-year decline in self-raised funds and sales proceeds narrowed. "Controlling the increment" is the key precondition for destocking and stabilizing house prices, and it is necessary to continue monitoring the performance of the front-end land market supply in the future. Investment targets Currently, mainstream targets have certain value-for-money, including A-share companies such as Xiamen C&D Inc. (600153.SH), Seazen Holdings (601155.SH), Hangzhou Binjiang Real Estate Group (002244.SZ), China Merchants Shekou Industrial Zone Holdings (001979.SZ), Hong Kong-listed companies such as CHINA RES LAND (01109), Jianfa International (01908), CHINA JINMAO (00817), GREENTOWN CHINA (03900), China Overseas Han's Properties (00081), Poly Property Group (00119), etc. Diversified sectors recommend CHINA RES MIXC (01209), GREENTOWN SER (02869), HANG LUNG PPT (00101), SWIREPROPERTIES (01972). Risk factors The unexpected deterioration of the supply-demand structure in core cities; external risks leading to downside risks.