Shenwan Hongyuan released a research report stating that property companies' sales in August showed a month-on-month decline of 13% and cumulative year-on-year decline of 18%, improving by 9.6pct and 0.6pct respectively compared to previous values, with the sales decline narrowing. Sales have shown volatility since 2025, improving in February before marginally declining from March to June, with the decline gradually narrowing in July and August. On the policy front, the State Council meeting in August called for increased efforts to consolidate the stabilization and recovery; Beijing and Shanghai have successively introduced policies to relax purchase restrictions. Currently, structural differentiation in the domestic sales market remains evident, with tier-1 and tier-2 cities outperforming tier-3 and tier-4 cities. The firm maintains that the subsequent real estate market will present a pattern of "structurally strong + overall weak," and continues to be optimistic about the sales performance of quality property companies positioned in core cities.

Shenwan Hongyuan's main viewpoints are as follows:

**August Property Sales Show Month-on-Month Decline of 13% and Cumulative Decline of 18%, with Sales Decline Narrowing**

According to CRIC data, in August 2025, 50 property companies achieved monthly sales of RMB 170.8 billion, down 13.4% year-on-year, an improvement of 9.6pct from the previous value; sales area was 9.47 million square meters, down 14.4% year-on-year, an improvement of 12.3pct from the previous value. From January to August 2025, sales amounted to RMB 1,557.8 billion, down 17.8% year-on-year, an improvement of 0.6pct from the previous value; sales area was 80.5 million square meters, down 24.3% year-on-year, an improvement of 0.3pct from the previous value.

Following the "stabilization and recovery" policy package catalyst at the end of September 2024, Q4 2024 sales showed significant narrowing in year-on-year decline. Sales have shown volatility since 2025, improving in February before marginally declining from March to June, with the decline gradually narrowing in July and August.

On the policy front, the June State Council meeting called for greater efforts to promote stabilization and recovery, with increased support for quality housing; the July Politburo meeting pointed out the implementation of urban work conference spirit and high-quality urban renewal; the August State Council meeting called for increased efforts to consolidate stabilization and recovery; Beijing and Shanghai have successively introduced policies to relax purchase restrictions.

Currently, structural differentiation in the domestic sales market remains evident, with tier-1 and tier-2 cities outperforming tier-3 and tier-4 cities. The firm maintains that the subsequent real estate market will present a pattern of "structurally strong + overall weak," and continues to be optimistic about the sales performance of quality property companies positioned in core cities.

**August Monthly Sales: China Merchants Shekou, COLI, and Poly Rank Top Three, with C&D, Jinmao, China Merchants Shekou, Binjiang, and Greentown Showing Counter-trend High Growth**

According to CRIC data, from monthly sales perspective, China Merchants Shekou ranked first, with COLI and Poly ranking second and third respectively. Specifically: China Merchants Shekou RMB 19.5 billion (YOY +39%), COLI RMB 18.3 billion (YOY -1%), Poly RMB 18.0 billion (YOY -19%), China Resources RMB 13.2 billion (YOY -13%), Greentown RMB 9.7 billion (YOY +17%), Jinmao RMB 9.1 billion (YOY +46%), Binjiang RMB 9.0 billion (YOY +27%), C&D RMB 8.1 billion (YOY +69%), China Railway RMB 5.6 billion (YOY -15%), Sunac RMB 5.4 billion (YOY -27%), China Overseas RMB 5.3 billion (YOY -12%), LONGFOR GROUP RMB 4.6 billion (YOY -29%), Greenland RMB 4.4 billion (YOY -12%), Excellence RMB 2.4 billion (YOY -3%), Gemdale RMB 2.2 billion (YOY -59%), Seazen RMB 1.7 billion (YOY -34%), Midea RMB 1.4 billion (YOY -48%), R&F RMB 1.0 billion (YOY +30%), among others.

**January-August Cumulative Sales: Poly, COLI, and China Resources Rank Top Three in Cumulative Sales, with Jinmao, C&D, and YUEXIU PROPERTY Showing Counter-trend Growth**

According to CRIC data, from cumulative sales perspective, Poly ranked first, with COLI and China Resources ranking second and third respectively. Specifically: Poly RMB 181.2 billion (YOY -18%), COLI RMB 150.3 billion (YOY -17%), China Resources RMB 136.8 billion (YOY -12%), China Merchants Shekou RMB 124.1 billion (YOY -5%), Greentown RMB 95.7 billion (YOY -9%), C&D RMB 85.1 billion (YOY +9%), YUEXIU PROPERTY RMB 73.0 billion (YOY +4%), Jinmao RMB 70.9 billion (YOY +26%), Binjiang RMB 70.5 billion (YOY -3%), China Overseas RMB 59.6 billion (YOY 0%), LONGFOR GROUP RMB 45.6 billion (YOY -30%), China Railway RMB 45.0 billion (YOY -15%), Greenland RMB 42.4 billion (YOY -1%), Sunac RMB 30.5 billion (YOY -13%), Gemdale RMB 22.0 billion (YOY -54%), Midea RMB 18.9 billion (YOY -27%), Excellence RMB 15.5 billion (YOY -23%), Seazen RMB 13.7 billion (YOY -54%), Shoukai RMB 12.8 billion (YOY -42%), among others.

**Investment Recommendations: Property Sales Decline Narrows, Quality Companies Show Counter-trend Growth, Maintaining "Positive" Rating**

Shenwan Hongyuan believes that China's broad housing demand has bottomed out, but volume and prices have not entered a positive cycle as expected. The firm predicts that real estate volumes will continue to bottom out, and expects further stabilization and recovery policies to be introduced. The firm also expects that real estate markets in core cities are already in the bottom inflection point area and will lead the recovery; meanwhile, the quality housing policy will open up new development tracks of "new products, new pricing, new models," which will promote improvement in real estate markets in core cities with lower quality housing penetration rates, and will also help quality property companies positioned in core cities and developing quality housing to enter the bottom inflection point moment first, promoting the transformation of business models from financial industry to manufacturing industry, thereby welcoming the upward breakthrough of PB-ROE.

The firm maintains a "Positive" rating for real estate and property management, recommending: 1) Product-focused companies: C&D International (01906), Binjiang Group (002244.SZ), CHINA RES LAND (01109), Greentown China (03900), China Jinmao (00817), C&D Corporation (600153.SH). 2) Low-valuation recovery companies: Seazen Holdings (601155.SH), YUEXIU PROPERTY (00123), China Merchants Shekou (001979.SZ), LONGFOR GROUP (00960), COLI (00688), Poly Development (600048.SH), China Overseas (600325.SH), with attention to Seazen Group (01030), Dalian Wanda Commercial (000031.SZ), Gemdale Group (600383.SH). 3) Second-hand housing intermediaries: BEKE-W (02423), with attention to 5i5j (000560.SZ); 4) Property management: GREENTOWN SER (02869), China Resources Mixc Lifestyle (01209), China Merchants积余 (001914.SZ), Poly Property (06049), COLI Property (02669).

**Risk Warning** Real estate industry sales and financing funding tightening again, government land acquisition and urban renewal progress falling short of expectations.