Hong Kong-listed mainland property shares rallied yesterday, a day after Beijing unveiled new measures to support the ailing market. However, analysts said home prices could continue to soften in coming months and that confidence would only return when home buyers got a better picture of the nation's economic outlook. Beijing will give directions to local governments to cut the tax on home buyers and loosen liquidity constraints for developers. It is hoped these will lure buyers into the market. Riding on the anticipation that sales activity will improve, Hopefluent Group Holdings, the biggest property agent in Guangzhou, shot up 59.57 per cent to HK$1.50 yesterday, following a jump of 20.51 per cent on Wednesday. KWG Property Holding yesterday rose 26.21 per cent to HK$2.60 and China Aoyuan Property Group rose 21.59 per cent to HK$1.07. Hopson Development Holdings, which rose 20 per cent on Wednesday, closed up 13.55 per cent to HK$6.20. Guangzhou R&F Properties rose 13.15 per cent to HK$8.86, following a 7.41 per cent rise on Wednesday. China Overseas Land & Investment, a developer controlled by the nation's construction ministry, surged 1.55 per cent to HK$11.78, while China Resources Land climbed 2.8 per cent to HK$10.28. Zhang Wayne, the general manager of the investment management department at Sino-Ocean Land, yesterday said the policy could stimulate demand for housing. Speaking after the company's extraordinary general meeting, Mr Zhang said he expected the central government would continue to introduce more measures. Sino-Ocean Land rose 3.03 per cent to HK$3.74 yesterday. Under the policy, lenders are encouraged to ease mergers and acquisitions among property developers and provide credit with preferential interest rates to developers of low and mid-tier housing. 'This will likely lead to a consolidation of the property development sector, thereby improving efficiency,' said Sherman Chan, an economist at Moody's Economy. com, a unit of Moody's Corp. The measures also include expanding the eligibility of the transaction tax exemption and providing preferential loan terms for second-home buyers if they live in smaller than average sized flats. 'The policy measures, if successful, will keep China's real estate and construction sectors solid in the near term, which will subsequently help to maintain the economy's growth momentum,' Ms Chan said. But Nicole Wong, head of CLSA's Hong Kong and China property research team, has reservations. 'The most effective policies were announced in October, which included the relaxation of down payment requirements, the stamp duty exemption, and an interest rate reduction for first-time buyers,' Ms Wong said. 'But sales activity did not jump sharply in the past two months. Therefore, I do not expect transaction volume will surge significantly because of this round of measures.'