Never let fundamentals get in the way of a good sentimental story. China’s property stocks should have one of the better stories around. Not only are interest rates coming down (China has cut rates twice since last November), on Monday evening Chinese regulators announced measures to support the sector. These included reducing mortgage downpayments and improving the tax environment for people who want to sell.
So one might expect that real estate stocks would respond positively. At first, indeed, they did. Major Hong Kong-listed property names, including China Overseas Land and Investment (COLI), China Resources Land and China Vanke (which announced soft results after the close on Monday) rallied as much as 8 per cent. They ended the day in the red.
所以人们可能以为地产股会应声上涨。一开始人们确实料中了。周二在香港股市，中国海外发展(COLI)、华润置地(China Resources Land)以及万科(Vanke)等龙头地产股盘中涨幅最高达8%（其中万科在周一收盘后公布了不太理想的业绩）。它们收盘时全部下跌。
Despite a macro situation turning marginally more cheery, there are sound reasons for being bearish on the sector. Results for 2014 across more than 30 Hong Kong-listed property companies have been disappointing. Half missed internal revenue forecasts; in aggregate, sales and earnings per share fell short of market expectations by about 5 per cent. Margins were compressed as developers offloaded inventory. Barclays figures show that average selling prices have dropped nearly one-fifth in the year to date, yet inventory levels have risen from 9.5 to 14.1 months. Recently reported net debt to equity is 72 per cent compared with a five-year average of 48 per cent.
Still, analysts remain bullish. Across the sector only a handful of names have more recommendations to sell than buy, according to Bloomberg. This is justified by valuations. Barclays says that the stocks it covers are on an average discount to forecast net asset value of over one-third. CLSA puts its coverage list on discounts of between 12 per cent (COLI) and 76 per cent (COLI affiliate China Overseas Grand Oceans).
尽管如此，分析师们仍看多该版块。根据彭博社(Bloomberg)，只有极少数地产股的“卖出建议”多于“买进建议”。而从估值来看，这是合理的。巴克莱表示，在其分析的地产股中，当前估值比预测资产净值平均折让三分之一以上。在里昂证券(CLSA)分析的股票中，折让率最低的为中国海外发展的12%，最高的为中国海外宏洋(China Overseas Grand Oceans)的76%，后者是中国海外发展的子公司。
Not everyone is buying this, however. Financial data analyst Markit lists Vanke and Evergrande as the top two shorts in Asia-Pacific last week. And Credit Suisse says that the easing measures are unlikely to have much impact: mortgage downpayments are often subsidised by developers desperate to realise sales.
More time may be needed before a true turnround is clear. Meanwhile, it is worth bearing in mind that some sentimental stories end in tears.