Leading Indicators Worsened Further in July

Research evidence excerpt

Leading Indicators Worsened Further in July

Idea

August 2, 2026 04:33 PM GMT

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

Equity Analyst

Leading Indicators Worsened Stephen.Cheung@morganstanley.comCara Zhu +852 3963-0385

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

Further in July

Secondary home prices continued to diverge among cities in July

amid a weakening trend in Tier 1 cities. We see the higher

secondary listing volume in Tier 2 and below cities, softening China Property

visitations, and still-weak resident sentiment boosting home Asia Pacific

Industry View In-Line

price drops in the coming months amid cooling sales.

Related reports:

Overall steady declines in secondary listing home prices: They fell 0.5% m-m (- 1. An Inflection or Another False Start? (18 May

9.6% y-y) across the 85 sample cities we track (vs. -0.5% in June), bringing 7M26 to - 2026)

3.1% y-y. Similar share (~95%) of sample cities recorded m-m declines, but with 2. June-26 AlphaWise Survey: Better Sentiment,

fewer cities seeing faster declines (49% vs. 56% in June). On the contrary, all Tier 1 but Still Limited Home Purchase Plans (14 July

cities recorded a faster m-m trend down, to -0.4% on average (vs. -0.1% in June), 2026)

which we attribute to catching up post their notable outperformance in March-June 3. 1H26 Preview: Weak Earnings amid Further

amid softening secondary home sales. We are concerned about ongoing drops in Margin Squeeze (16 July 2026)

listing prices exerting stronger pressure on transaction prices in 2H, especially 4. Managed Housing Downcycle to Last Another

during the low season in summer. Two Years (25 Jan 2026)

5. 2026 Outlook: Physical Market Stays

Secondary listing trends continued to diverge: Total listings across ~50 sample