China property stocks rise on strong sales
Shares of mainland developers fell on profit taking yesterday but were up for the week after surging on the back of brisk sales by a growing number of developers.
"We expect property sales will continue to be strong with more new launches," said David Ng, a property analyst at Macquarie Equities Research.
China Overseas Land & Investment said contract sales were HK$111.8 billion for the first nine months of the year, representing 93 per cent of its HK$120 billion annual sales target.
Goldman Sachs lifted its contract sales forecast for Country Garden - controlled by the mainland's richest woman, Yang Huiyan - by 35 per cent to 95 billion yuan (HK$120 billion) this year and predicts further growth next year to 103 billion yuan.
Country Garden had contracted sales of 64.7 billion yuan in the first nine months of the year, exceeding its 62 billion yuan sales target for the whole year, it said in a statement filed to the Hong Kong stock exchange on Tuesday.
In response to positive sales, shares of Country Garden rose 9.6 per cent this week to close at HK$5.50 yesterday, Guangzhou Evergrande was up 6.7 per cent on the week at HK$3.65, Shimao Property leapt 9.7 per cent to HK$20.20 and China Overseas Land climbed 4.9 per cent to HK$24.35.
Kenneth Pak Kei-yuen, a senior general manager in Midland Realty's Beijing office, said small homes on the capital's outskirts saw strong sales during the National Day "golden week" holiday. "Given the small lump sum involved, these housing projects are catering to young, first-time home buyers," he said.
Most units, with sizes ranging from 50 to 80 square metres, were sold at between 12,000 and 13,000 yuan per square metre, compared with prices of 50,000 yuan per square metre in city areas.
There were 800 units in four major new projects sold during the week-long holiday, double the number in the same period last year.