China Securities Co., Ltd.: The effect of the stabilization of the real estate market in March continues to show, optimistic about the sector's value under the strategy of boosting domestic demand.

China Securities Co., Ltd. released a research report stating that the year-on-year decrease in national commodity housing sales area in March was 0.9%, narrowing the decline by 4.2 percentage points compared to January and February, showing a stabilizing effect. The improvement in sales is more prominent in high-energy cities, but the sales growth rate is still in negative territory, indicating the need for further consolidation of the market stability. Real estate companies continue to show high enthusiasm for land acquisition in core cities, with premium rates for residential land auctions in first and second-tier cities remaining high. Meanwhile, the enthusiasm for construction has also significantly improved, with a substantial decrease in the newly initiated construction area in March. The firm believes that expanding domestic demand under external pressures should be a long-term strategy, and supportive policies for the real estate sector are expected to increase, making the sector a good investment choice. Amid the uncertainty of the global trade war, policies to expand domestic demand are frequent, and further policy adjustments are expected, recommending high-quality commercial real estate companies. Key points from China Securities Co., Ltd. include: The National Bureau of Statistics published data on the real estate market in March 2025, showing year-on-year decreases in sales area, investment amount, newly initiated construction area, and completed construction area of 11.23 million square meters, 918.4 billion yuan, 63.82 million square meters, and 42.96 million square meters, respectively. The year-on-year growth rates were -0.9%, -10.0%, -18.1%, and -11.5%, respectively, narrowing from the rates in January and February. The stabilizing effect continues to show, but further consolidation is needed. In March, the year-on-year decrease in national commodity housing sales area was 0.9%, narrowing the decline by 4.2 percentage points compared to January and February. While the stabilizing effect is evident, sales growth is still negative nationwide; in March, the new housing transaction area in 40 cities increased by 6%, mainly seen in high-energy cities. The latest data up to April 11th show a 4% year-on-year decrease in new housing transaction area in 40 cities, indicating weakened momentum compared to March and the need for further consolidation of market stability. The firm believes that the implementation of specific measures to digest existing inventory, optimize incremental supply, and promote the construction of "good houses" will determine the market's future direction. Investment decline slightly widened, while the decrease in newly initiated construction significantly narrowed. In March, the year-on-year decline in real estate development investment was 10.0%, expanding by 0.2 percentage points compared to January and February. Against the backdrop of continuous stabilizing effect, real estate companies continue to show high enthusiasm for land acquisition in core cities, with premium rates for residential land auctions reaching 31% in first-tier cities and 18% in second-tier cities. The enthusiasm for construction significantly improved, with a year-on-year decrease of 18.1% in newly initiated construction area in March, narrowing by 11.5 percentage points compared to January and February. The completion of construction work continues to progress, with a year-on-year decrease of 11.5% in completed construction area in March, narrowing by 4.1 percentage points compared to January and February. Expanding domestic demand as a long-term strategy under external pressures, expectations for increased support policies for the real estate sector, and the perceived value of sector allocation. Amid the uncertainty of the global trade war, policies to expand domestic demand are frequent, with expectations of further policy enhancements, thereby recommending high-quality commercial real estate companies. Risk warning: Risks in the real estate industry include: 1. Lower than expected sales; 2. Deferred transfers; 3. Slow credit repairs for real estate companies.