Shi Yongqing estimates that property prices will stabilize after falling another 15%.
The Central Plains City Leading Index (CCL) fell more than 8.86% from the high level in August last year. Shi Yongqing, chairman and president of Zhongyuan Group, said that the property market has formed a downward trend, and it is expected that the property price will fall after it drops 10% to 15% this year. However, Morgan Stanley expects property prices in Hong Kong to rise by 2% this year.
Da Mo upgrades property stock rating
Shi Yongqing believes that this year’s property market is a “political city", which is subject to Sino-US trade frictions, rather than problems in the fundamentals of the property market. He also pointed out that the current decline in the leading index of the Central Plains city has not fully reflected the impact of the Sino-US trade war. It is expected that the second-hand property price will fall by 10% this year, and the first-hand property price will fall by 15% to 20%.
However, the company expects property prices in Hong Kong to rise by 2% this year. Coupled with the valuation of real estate stocks and the expected rate hike, the property stocks are upgraded to “attractive". Morgan Stanley mentioned that property prices have fallen by about 9% since August last year. The market expects property prices to continue to fall this year, but the bank expects property prices to bottom out in the first quarter of this year and rise by about 2% for the whole year. The preferential interest rate will remain unchanged. Hong Kong banks will not follow the US interest rate hike and provide liquidity to the market. The mortgage interest rate will remain below 3%.