China’s Biggest Real Estate Developers Look Unlikely to Meet Annual Sales Targets
What’s new: China’s real estate giants are unlikely to meet their annual sales targets as the sector is roiled by crackdown and crisis, analysts have said, as many report double-digit dips running into the crucial fourth quarter.
About half of the country’s top 100 property firms have more than 30% of their sales quotas left for the final quarter, according to a new research from property consultancy China Real Estate Information Corp.
In a regular year that would be a modest goal — developers often complete between 35% and 40% of their sales in the final quarter, a marketing director at a Hong Kong-listed property company told Caixin. But this September, when sales often peak, many companies saw a slump, auguring poorly for the near future.
Details: As of September, less than one-fifth of the top 100 firms were on track to meet their annual target, with Hong Kong-listed Dafa Properties Group Ltd. and Greentown China Holdings Ltd., Shanghai-listed Beijing Capital Development Co. Ltd. (600376.SH) and Gemdale Corp. (600383.SH), and Shenzhen-listed Hangzhou Binjiang Real Estate Group Co. Ltd. (002244.SZ) fulfilling more than 80% of their yearly sales quotas.
Nine out of the 23 firms that have disclosed September’s sales so far reported a more than 30% decrease, of which Hong Kong-listed Kaisa Group Holdings Ltd. and Sunshine 100 China Holdings Ltd., and Radiance Holdings Group Co. Ltd. reported declines of over 60%.
Background: China’s residential property slowdown is deepening, with the tightening regulation toward prices and an escalating crisis triggered by the debt problems of behemoth China Evergrande Group.
In August, China’s home sales by value slumped 20%, the biggest drop since the onset of the pandemic at the start of 2020, according to Bloomberg calculations.
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