Hong Kong-listed mainland property stocks experienced widespread declines in today's trading session.
At the time of writing, GREENTOWN CHINA (03900) shares were down 4.78% to HK$7.37, SUNAC (01918) shares fell 3.85% to HK$0.75, and R&F PROPERTIES (02777) shares dropped 1.96% to HK$0.25.
The downturn follows the release of official data showing a continued and accelerated decline in real estate investment.
Statistics reveal that the year-on-year growth rate for property investment decelerated to -24.9% in May, a significant widening from the -20.1% decline recorded in April.
In contrast, May's sales value and sales area showed comparatively better performance, declining by 9.8% and 14.1% year-on-year, respectively, figures that are far less severe than those for investment and new construction starts.
Analysts note that the acceleration in the property investment downturn aligns with prior expectations, with other sector indicators still in the process of finding a bottom.
The broader situation, characterized by ongoing supply rationalization and the potential for demand improvement, remains unchanged.
Other market commentary suggests that current valuations of property stocks already reflect, or even overprice, pessimistic expectations for future home price declines.
Furthermore, recent sequential improvements in sector data have not yet translated into share price gains.
Should the positive data trends persist, even a modest shift in market sentiment could provide a significant boost to the sector.
Assuming high-frequency data avoids a secondary downturn, a consensus that home prices have stabilized is expected to form.
Price increases in some cities would further alleviate pressure on asset impairment provisions.
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