HSBC China Real Estate: Home Price Stabilisation Not Just in Shanghai
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HSBC notes that March 2026 National Bureau of Statistics housing data reveals a broadening stabilization in home prices, with an increasing number of cities reporting month-on-month gains. The number of cities seeing new home price increases rose to 14 in March from 10 in February, while existing home price gains expanded from 2 to 13 cities. This geographic expansion beyond Shanghai should bolster investor confidence that the broader market is approaching a turning point. At the recent HSBC Global Investment Summit, China real estate drew significant interest, with discussions centered on the sustainability of sales momentum and whether prices have bottomed. Unlike previous mini-cycles, investors increasingly recognize that policy is no longer the sole catalyst. Easing seller pressure and improving buyer participation are establishing a more durable foundation for price stability. Resilience in the existing home market could transmit to new home demand. Additionally, recovery signals include upgrading-driven existing home transactions, stable rents, strong luxury project sales in tier-two cities, and improving suburban sales in tier-one cities. HSBC continues to favor China Resources Land (1109 HK) and C&D International (1908 HK), both rated Buy, for their superior earnings visibility and high-end product positioning. The firm also maintains a Buy on Seazen (1030 HK), citing its resilient shopping mall portfolio in lower-tier cities.