Mar17-Mar23transactionvolumeandASP
Onawowbasis,21outof34citieswithdataavailablesawvolumesincrease,withagroupmedianof+2%(vs.-2%fortheweekendedMar16).Onayoybasis,28outof33citieswithdataavailablesawvolumesdecrease,withagroupmedianof-29%(vs.-34%).ComparedwiththeFeb2014weeklyaverage,25of34citieswithdataavailablesawvolumesincrease,withagroupmedianof+28%(vs.+21%).Inrelativeterms,Tier1citiesoutperformedtier2/3cities,andtheSouthernChinaregionoutperformedotherregions.IntermsofASP,onawowbasis,6outof10citieswithdataavailablesawpricesfall,withagroupmedianof-0.3%(vs.+3%).Ona3-monthcumulativebasis,10citieswithdataavailablesawpricesflat,withamedianlevelof+0.4%higherthantheprior3-monthaverage.
YTDperformance
Asofend-Mar23,35citieswithdataavailablesawaverageweeklyvolumes16%higherthantheFeb2014average,but24%/18%lowerthanthefull-year2013/1H13averages.Ytd,22of24citieswithdataavailableonamedianlevelsawvolumesdecrease,withagroupmedianof-35%yoy(vs.-30%fortheweekendedMar16).IntermsofASP,18outofthe25citiessawpricesincreaseytd,withagroupmedianof+10%yoy(vs.+9%).
Inventorylevels
Totalinventoryfor13citiesincreasedby0.1%wow(vs.+0.3%fortheweekendedMar16).Accordingtothe12-monthrollingGFAsold,averageinventorytake-up(forthe13citieswetrack)increasedto13.2months(vs.13monthsfortheweekendedMar16).Amongthe13cities:1)inventorywasstableinChangchun,Suzhou,Dongguan,Hangzhou,Shanghai,GuangzhouandNingbo;2)inventoryincreasedinBeijing,QingdaoandFuzhou;3)inventorydecreasedinNanjing,XiamenandShenzhen.
Investmentview
Buyideas:CountryGarden(onCL),Greentown(onCL),CML,E-House,Longfor,CRL,Shimao,Vanke(B),Vanke(A),Poly(A),WorldUnion,andCMP(A).Sellideas:YanlordandShuiOnLand.Keydownsiderisks:substantialdeteriorationindevelopers’balancesheets.Keyupsiderisks:better-than-expectedeconomicconditions/policyloosening.