Positive news emerging, data warming up Real estate market "little spring" can be expected! These three high-dividend targets attract fund buying

On the morning of March 17, the real estate sector fluctuated upward, with China Energy Investment Property, Beijing Investment Development, and Zhongzhou Holdings leading the charge, hitting the daily limit. Several other stocks, including China Fortune Land Development, Longfor Properties, and Beichen Industrial, also followed the rally.

Industry insiders point out that as inventory indicators reach a turning point, signs of price stabilization strengthen, and policy effects continue to be released, market confidence is gradually recovering. The “small spring” market rally is worth looking forward to.

Several Real Estate Indicators Show Early Signs of Warmth

Data released by the National Bureau of Statistics on March 16 show that in February, the month-over-month decline in housing prices in 70 large and medium-sized cities continued to narrow. The number of cities where new home prices increased month-over-month rose by 5 compared to the previous month. In first-tier cities, new home prices remained flat, shifting from a 0.3% decline last month to stability. Beijing and Shanghai both rose by 0.2%, while Guangzhou remained unchanged.

Industry experts believe that the continued narrowing of month-over-month price declines and the first-tier cities’ new home prices stabilizing are direct signs of market warming. The increase in the number of cities with rising prices further confirms the market’s recovery.

Additionally, from January to February, nationwide real estate development investment saw a 6.1 percentage point narrower decline year-over-year compared to the full year of 2022. By the end of February, the year-over-year growth rate of unsold commercial housing area slowed by 1.5 percentage points compared to the end of 2022.

Yan Yuejin, Deputy Director of the Shanghai E-House Research Institute, pointed out that although real estate development investment still remains in negative growth territory, the decline has significantly narrowed compared to the full year of 2022. This change reflects that supply-side adjustments are gradually stabilizing.

Shanghai Further Lowers Commercial Property Purchase Thresholds

Not only are data showing signs of improvement, but favorable policies are also emerging in the housing market.

On March 16, the Shanghai branch of the People’s Bank of China, together with the Shanghai Regulatory Bureau of the National Financial Supervision and Administration, issued a notice titled “Adjustment of the Minimum Down Payment Ratio for Commercial Property Purchases in Shanghai.”

The notice clarifies that starting immediately, the minimum down payment ratio for commercial properties (including “commercial-residential mixed-use” properties) in Shanghai is adjusted to no less than 30%. This is another “stabilization” measure following the implementation of the “Seven Policies” in Shanghai’s housing market on February 26. It also marks the first change in Shanghai’s commercial and office mortgage policies in nearly 20 years.

Previously, the People’s Bank of China and the Financial Supervision and Administration announced on January 17 that the minimum down payment ratio for commercial properties (including “commercial-residential mixed-use” properties) would be adjusted to no less than 30%. Before this policy, most cities across the country required a 50% down payment for commercial properties, with some banks or specific projects setting requirements as high as 60% or more.

Short-term Market Outlook Still Positive

Zhang Bo, President of 58.com Anjuke Research Institute, said, “February’s housing price data already sent clear positive signals, showing a structural recovery. The performance of core cities in first- and second-tier regions has become the main driver of this recovery. This structural rebound indicates that supply and demand are increasingly aligned, and the market’s steady improvement makes the ‘small spring’ rally worth expecting.”

Yan Yuejin also believes that as supply-side adjustments become sufficient and inventory pressures ease, if potential demand continues to be released, the process of market supply-demand rebalancing could accelerate, leading to steady transaction volume growth and price stabilization. Under multiple positive factors, a “small spring” market rally is expected, with a gradual stabilization and improvement trend throughout the year.

Latest research from Orient Securities indicates that high-frequency data shows a strong performance of the spring market this year. Coupled with policy expectations from the April Politburo meeting, the short-term policy game and fundamentals are unlikely to be disproven, so the industry’s pulse rally may continue in the short term.

Three High-Dividend Stocks Attracting Attention

According to Orient Fortune Industry Sector data, currently, over 80 A-share stocks belong to the real estate development sector, with a total market value exceeding 1 trillion yuan. China Merchants Shekou, Poly Developments, and Zhangjiang Hi-Tech are the top three by market cap, with Vanke A, Lujiazui, and Sunac China also exceeding 30 billion yuan.

Since the beginning of the year, nearly 70% of real estate development stocks have seen their share prices rise. The sector has produced two stocks with doubled share prices. Today, the nearly flat-listed Jingtou Development surged 1.5 times, leading the gains, while China Energy Investment Property also doubled in price. Stocks like *ST Rongkang, Tibet Urban Investment, and *ST Sunshine have gained over 40% within their ranges.

Data from Orient Fortune Choice shows that 11 real estate development stocks have a dividend yield (TTM) exceeding 2%. China World Trade Center and Jinbin Development have dividend yields as high as 5.43% and 4.19%, respectively. Nanjing High-Tech and Suning Universal also have dividend yields above 3%.

Notably, among these 11 high-dividend stocks, three have attracted leveraged funds this month. Poly Developments received 130 million yuan in financing, while Suning Universal and Huafa Group had net financing purchases of 12.81 million yuan and 3.65 million yuan, respectively.

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(Source: Orient Wealth Research Center)