Chinese developer Times Property says policy tightening having limited impact on sales
Core profit, excluding one-off items, rose 17.6pc to 635.7 to US$94.46 million, thanks to strong sales increase, but net profit was down 9 per cent, blamed on early redemption of 132 million senior notes
“The government starts a tightening cycle every two or three years, and every time the market seems very pessimistic, as if real estate companies will die as a result– but that hasn’t happened,” said Times Property chairman Michael Shum Chiu-hung.
Shum said the company’s business wasn’t that affected by the local governments’ control on selling prices as most of their land banks were bought at lower cost, back in 2015 and 2016.
Although mainland regulators shut down a number of funding channels for developers such as domestic bond issuance, Shum said he believed Beijing, long term, will still encourage real estate companies to seek financing through the public markets.
The government starts a tightening cycle every two or three years, and every time the market seems very pessimistic, as if real estate companies will die as a result– but that hasn’t happened
The company forecasts house purchase demand in big, regulated cities will continue to be suppressed, while transactions in third- and fourth- tier cities will remain active, especially in satellite towns close to the core metropolitan areas.
The company’s core profit, excluding one-off items, rose 17.6 per cent to 635.7 million yuan (US$94.46 million) in the first half, thanks to the sales increase, but net profit was down 9 per cent to 497.8 million yuan, blamed on the early redemption of 132 million senior notes within the period.