Monthly Tracker: Mixed May; Renewed Weakness Ahead

Research evidence excerpt

Monthly Tracker: Mixed May; Renewed Weakness Ahead

Idea

June 23, 2026 08:30 AM GMT

Morgan Stanley Asia Limited+MChina Property | Asia Pacific Stephen Cheung, CFA

Equity Analyst

Monthly Tracker: Mixed May; Stephen.Cheung@morganstanley.comCara Zhu +852 3963-0385

Cara.Zhu@morganstanley.com +852 2848-7117

Renewed Weakness Ahead

Home sales improved in May amid mixed home price trends, but

the sharp slowdown in secondary home sales in June could

weaken the property metrics in 3Q, given still-elevated China Property

inventory, fragile buyer sentiment, and subdued outlook for Asia Pacific

Industry View In-Line

household income.

Stay prudent: Given increasing uncertainty around sales recovery, we continue to

favor beneficiaries with both industry beta and self-help alpha. CR Land (1109.HK) Related reports:

remains our Top Pick, followed by C&D (1908.HK), as both offer solid EPS outlooks, 1. An Inflection or Another False Start? (18 May

attractive dividend yields, and potential for medium-term re-rating even in the 2026)

absence of a meaningful recovery in the physical market. 2. More Signs of Secondary Home Sales

Weakening (11 June 2026)

(+) Home sales improved: CREIS 65-city primary registered sales volume increased

3. Managed Housing Downcycle to Last Another

1% y-y in May (vs. -3% in April) and 33-city secondary registered sales volume rose

Two Years (25 January 2026)

17% y-y (vs. +8% in April). This brought YTD sales to -15% y-y for primary and +2% y-

4. 2026 Outlook: Physical Market Stays

y for secondary. However, Bingshan 25-city secondary real-time sales volume

Challenging; Diverging Outperformance of

softened to +26% y-y (vs. +30% in April) and decelerated further in June, indicating

Alpha Plays (10 December 2025)

potential weakness in registered sales ahead.