Primary Home Sales Remained Weak and Diverged in July

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M

Idea

July 31, 2026 06:19 PM GMT

China Property | Asia Pacific

Morgan Stanley Asia Limited+

Stephen Cheung, CFA

Equity Analyst

Primary Home Sales Remained

Weak and Diverged in July

PTI data show the property sales for the top 100 developers

remained weak at -11% y-y in July despite an easier base. We

maintain our cautious view of potentially faster m-m home price

drops in coming months amid softer home sales, and continue to

suggest sticking with quality alpha plays.

Cara Zhu

Equity Analyst

China Property

Asia Pacific

Industry View

In-Line

Related reports:

Major developers' sales stayed sluggish, as we expected, falling 7% and 11% y-y in

1. An Inflection or Another False Start? (18 May

July, respectively, for top 50 and top 100 developers on attributable basis (vs. -8%

2026)

and -11% in June). This narrowed the YTD sales declines slightly to 13% for the top

2. 1H26 Preview: Weak Earnings amid Further

50 and 15% y-y for the top 100. For the 30 major developers we track, the sales

Margin Squeeze (16 July 2026)

drop widened to 16% y-y (vs. -15% in June), bringing the YTD sales decrease to 23%

3. Monthly Tracker: June Data Deteriorated;

y-y.

Weaker 3Q Ahead (17 July 2026)

Continuous divergence in sales performance: SOEs continued to post positive

sales growth. COLI, C&D, Jinmao and CR Land outperformed at 27%, 26%, 9% and

6% y-y, respectively. In contrast, KWG, Longfor, Shimao, Zhongliang and Midea RE

posted >55% y-y declines. Some semi-SOE developers also recorded weak

performances; Gemdale and Vanke dropped 42% and 50% y-y, respectively. We

4. Managed Housing Downcycle to Last Another

Two Years (25 Jan 2026)

5. 2026 Outlook: Physical Market Stays

Challenging; Diverging Outperformance of

Alpha Plays (10 Dec 2025)

attribute SOE outperformance to their stronger brands and more new saleable

resources in top-tier cities.

Home sales may stay sluggish: Secondary sales volume in 25 major cities softened

further to ~9% y-y in July (vs. 30% in April, 25% in May and 10% in June).

Considering the uneven macro development, still-fragile resident sentiment, and

…