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SCMP Reporter

Mainland-listed property stocks slumped yesterday amid media reports of price cuts by market leader China Vanke to boost sales amid a slowing economy.
Vanke dropped 5.66 per cent to 6 yuan (HK$6.84) in Shenzhen; Poly Real Estate Group, the second-largest by market value, slumped 9.89 per cent to 12.03 yuan, while Shanghai's Industrial Development  slid the 10 per cent daily limit to  8.33 yuan.
Several mainland newspapers including Shanghai Securities News  yesterday said Vanke had cut  prices for its project in Hangzhou. That came after previous reports  suggested the developer had been offering discounts on its eight projects in Shanghai.
The slump in property plays dragged the benchmark  Shanghai Composite Index down 59.025 points or 2.68 per cent   to a 21-month closing low of 2,143.421  on turnover of 27.7 billion yuan.
'It's hard to figure out the negative factor dragging down the property plays from the performance of a single trading day,' said an analyst.
Still, analysts are generally pessimistic about the outlook of the mainland property market as potential homebuyers  adopt a wait-and-see attitude.
Slowing transactions and tightened bank loans  have  been putting pressure on developers' cash flows, prompting them to cut prices to boost sales for fresh capital to service their debts.
'I think October could be even worse, as many developers would be in great financial trouble  after they realise their sales targets cannot be achieved after the National Day  holiday - a traditional hot period for property sales. That would trigger price cuts across the nation,' the analyst said.



Mainland property  stocks slump after Vanke cuts prices to lift sales