CRIC: The top 100 real estate companies saw a month-on-month performance increase of 73% in October, achieving positive year-on-year growth for the first time this year

Introduction: In October 2024, new housing supply fell by 40%, while transactions continued a U-shaped trend, reaching the second highest level of the year. The supply in 30 key cities decreased by 40% month-on-month, significantly lower than the average monthly supply in the third quarter. Transactions continued to rise from September, increasing by 33% month-on-month, and up 37% compared to the average monthly value in the third quarter; the cumulative year-on-year decline for the first ten months was 30%, with the decline narrowing by only 2.67 percentage points compared to the previous month.

At the corporate level, in October, the top 100 real estate companies achieved a sales turnover of CNY 435.49 billion, a month-on-month increase of 73%, reaching the second highest performance of the year. Year-on-year, it increased by 7.1%, marking the first time this year that a single month achieved positive year-on-year growth. The cumulative performance from January to October was CNY 3,069.31 billion, a year-on-year decrease of 32.7%, with the decline narrowing by 3.9 percentage points compared to September.

Looking ahead to November, we believe that the favorable new policies in core first- and second-tier cities in October continued to take effect, leading to a return of overall transactions to high levels for the year. In November, as the positive effects of the new policies diminish, combined with seasonal factors, market growth momentum is expected to slow slightly. From the weekly changes in new housing transaction areas in core first- and second-tier cities in October, there is indeed a trend of "rising first and then falling." This indicates that the positive effects of the new policies are diminishing, and the release of existing customers is approaching a phase of conclusion.

Top 100 Real Estate Companies Achieve 73% Month-on-Month Growth in October, First Time for Year-on-Year Positive Growth in a Single Month

In October 2024, the top 100 real estate companies achieved a sales turnover of CNY 435.49 billion, a month-on-month increase of 73%, reaching the second highest performance of the year. Year-on-year growth was 7.1%, marking the first time this year that a single month achieved positive year-on-year growth. Cumulatively, from January to October, the top 100 real estate companies achieved a sales turnover of CNY 3,069.31 billion, a year-on-year decrease of 32.7%, with the decline narrowing by 3.9 percentage points compared to September.

Thresholds for Top 100 Real Estate Companies Slightly Narrowed

In October 2024, the sales thresholds for the top 100 real estate companies further decreased compared to the same period last year, with thresholds for each tier remaining at their lowest levels in recent years, but the decline this month was slightly narrowed. Among them, the sales turnover threshold for TOP 10 real estate companies decreased by 46.1% year-on-year to CNY 74.92 billion. The thresholds for TOP 30 and TOP 50 real estate companies also decreased by 37.4% and 37.5% year-on-year to CNY 20.5 billion and CNY 12.81 billion, respectively. The sales turnover threshold for TOP 100 real estate companies decreased by 34.9% to CNY 5.69 billion

October Supply Decreased but Transactions Reached Second Highest of the Year; November Transactions Expected to Slightly Decline

Thanks to favorable new policies and aggressive promotions by real estate companies to "self-rescue," October new home supply fell by 40% while transactions continued a U-shaped trend, reaching the second highest of the year: In 30 key cities, October supply decreased by 40% month-on-month, significantly lower than the average monthly supply in the third quarter. Transactions continued the upward trend from September, increasing by 33% month-on-month and 37% compared to the average in the third quarter, with a cumulative year-on-year decline of 30%, a reduction of only 2.67 percentage points from the previous month.

In terms of tier levels, first-tier cities are direct beneficiaries of the new policies, with both month-on-month and year-on-year increases in transactions. The four first-tier cities saw a month-on-month increase of 45% and a year-on-year increase of 9%, growing 34% compared to the average in the third quarter, with a cumulative year-on-year decline of 23%. Except for Shanghai, Beijing, Guangzhou, and Shenzhen all experienced varying degrees of recovery month-on-month, mainly due to the stimulation from new policies prompting existing customers looking to buy homes to enter the market quickly. Leading real estate companies also performed notably: China Resources Land's Shenzhen company sold over 1,000 units across 16 projects within 8 days after the new policy, amounting to approximately 3 billion yuan. Excellence in Shenzhen surpassed the 3 billion yuan sales mark in October, with multiple projects like Longhua Baiyi Mansion and Baoan Xingyi Mansion selling well; Longhua Junyi Mansion sold over 100 units within 36 hours of the new policy.

Second and third-tier cities saw lower month-on-month growth compared to first-tier cities, with year-on-year declines, and the cumulative year-on-year decline significantly higher than that of first-tier cities. Cities can be categorized as follows:

(1) Cities with high transaction rankings such as Chengdu, Wuhan, Tianjin, Xi'an, and Hangzhou maintained month-on-month increases but saw year-on-year declines. Although the short-term market heat continued, it was no longer comparable to the same period last year; notably, Tianjin fully lifted purchase and price restrictions in mid-October, which indeed stimulated a wave of first-time and upgrading buyers entering the market, showing signs of stabilization and recovery in the overall real estate market.

(2) Nearly half of the weaker second and third-tier cities saw both month-on-month and year-on-year increases, with Suzhou, Ningbo, Jinan, Kunming, Nanning, Xiamen, Fuzhou, Foshan, Huizhou, and Changzhou as typical representatives. After undergoing deep adjustments earlier, October saw a recovery in transactions due to the favorable central government policies stabilizing market confidence and some real estate companies strengthening their marketing efforts, leading to a narrowing of the cumulative year-on-year decline.

(3) Cities like Chongqing, Changchun, and Zhuhai continued to decline month-on-month, with overall transactions remaining at low levels.

Looking ahead to November, we believe that the favorable new policies in core first and second-tier cities in October will continue to have an effect, bringing overall transactions back to high levels for the year. However, in November, as the effects of the new policies diminish and seasonal factors come into play, market growth momentum is expected to slow down slightly.

In fact, from the changes in weekly new home transaction areas in core first and second-tier cities in October, there is indeed a trend of "rising first and then falling." In the fourth week of October (October 21-27), the new home transaction area in 30 cities slightly decreased by 2% month-on-month, shifting from an increase to a decrease; meanwhile, the visiting and subscription situations in cities like Guangzhou and Shenzhen also showed signs of weakening growth In the second-hand housing market, according to CRIC monitoring, in the fourth week of October (10.21-10.27), the transaction area of second-hand houses in 14 key monitored cities was 1.945 million square meters, with a total of 20,351 transactions, both down 2% month-on-month. This indicates that the positive effects of the new policies are showing a diminishing trend, and the release of existing customers is approaching a phase of conclusion.

Article author: CRIC Research Center, source: Ke Rui Real Estate Research, original title: "Top 100 Sales Ranking of Chinese Real Estate Companies from January to October 2024"