China Real Estate A positive leading indicator after valuation reset

Research evidence excerpt

China Real Estate A positive leading indicator after valuation reset

2 July 2026

China Real Estate EquitiesREMD

A positive leading indicator after valuation reset China

◆ Valuation reset after sharp pullback, on par with recent Stephen Wang*, CFA

troughs, offering opportunities Analyst, Asia Real Estate

The Hongkong and Shanghai Banking Corporation Limited

stephen.wang@hsbc.com.hk

◆ Land auctions in top-tier cities are signalling a luxury-led +852 2284 1675

recovery, a leading indicator to anchor price expectations Michelle Kwok*

Head of Asia Real Estate and HK Equity Research

◆ Prefer CR Land (TP HKD43.80) and C&D (TP HKD19.90), michellekwok@hsbc.com.hk

both rated Buy +852 2996 6918

Oliver Yu*

Analyst, Asia Real Estate

Opportunities after valuation reset? The sector rallied on an inflection narrative in The Hongkong and Shanghai Banking Corporation Limited

Apr-May, then corrected sharply amid intensifying macro headwinds, unfavourable oliver.y.o.x.yu@hsbc.com.hk

+852 2288 2050

fund flows and slowing sales momentum. Key SOEs trade at 0.44x P/B, around 1 SD

Brian Yu*

below the historical mean since 2021 and on par with prior troughs in March 2026 Associate, Asia Real Estate Research

and December 2025, when the market appeared to price in sales disappointment and The Hongkong and Shanghai Banking Corporation Limited

brian.d.yu@hsbc.com.hk

earnings pressure. Despite moderated sales momentum, we think the 2026 inflection +852 28227281

thesis remains intact, and the recent reheating in the land market is a positive leading

indicator. The pullback therefore offers opportunities, though the lack of near-term * Employed by a non-US affiliate of HSBC Securities (USA) Inc, and is

not registered/ qualified pursuant to FINRA regulations

catalysts remains a key pushback.