China property sector to stabilise as cooling measures take hold, Moody’s says
Analysts say property sales growth will slow in 2017 and risks of further tightening measures remain
China’s real estate market is on track to stabilise despite the risk that any further tightening measures could hurt developers and cause a sharp fall in home sales, according to Moody’s analysts.
Meanwhile, the credit ratings agency sees Hong Kong property companies enjoying modest earnings growth in the next year.
The mainland property sector has a stable outlook for the near term, a Moody’s Investor Service report said, with the effects of newly introduced cooling measures unlikely to result in “dramatic declines” in sales or prices during the next six to 12 months.
But the latest round of restrictions is expected to slow sales growth in 2017 from the 43.2 per cent rise in national contracted sales seen in the first nine months of this year, according to the report.
China rolled out property tightening measures in late September and early October in around 20 cities in an attempt to temper surging real estate prices and overheating markets.
“We expect the government will continue to balance its desire to keep price growth in check with its target of maintaining a stable property sector to support economic growth,” Cindy Yang, a Moody’s analyst, said ina press release accompanying the report.