Mainland China first-tier secondary listings keep falling, while Hong Kong housing market momentum is cooling at the margin

Overview

This is a J.P. Morgan high-frequency data tracking report on Mainland China and Hong Kong real estate and conglomerates. The report covers Mainland secondary transactions and listings, primary and secondary net-signing data, Zhongyuan leading indicators, the Hong Kong residential market, southbound holdings, equity performance, and credit bond recommendations. The core conclusion is that in Mainland China, continued declines in first-tier city secondary listings provide support for price stabilization; in Hong Kong, half-year gains have already achieved the full-year target range, but high-frequency indicators such as transaction volume, CSI, and CVI indicate cooling sentiment.

Core views

In Mainland China, secondary transactions remain in year-over-year growth, and first-tier city listings have retreated 3.5% from the March peak; the report views reduced supply as supportive of stable secondary home prices. In Hong Kong, the CCL index rose 12% in the first half, hitting the annual target range of 10-15%, but 54% YoY declines in transactions in 35 major estates and declines in CSI and CVI suggest upward momentum in H2 may slow to below 5%. On market performance, the Mainland China property sector rose 4% last week, outperforming the HSI’s 3%; the Hong Kong property and conglomerates sector rose 2%, slightly underperforming the HSI. In credit, the JACI China HY Property index rose 0.16% last week, with a YTD return of 5.5%.

Analysis framework

The report adopts a high-frequency monitoring framework that combines Bing Shuai Index real-time secondary transactions and listings, Zhongyuan secondary asking-price and dealer confidence indices, net-signing registration data, Hong Kong CCL/CSI/CVI, southbound holdings, equity performance, and credit spread/yield to assess marginal changes in real estate transactions, prices, sentiment, and asset performance.

Methodology notes

• High-frequency real estate monitoringBing Shuai Index and net-signing data tracking

  Real-time transactions lead official net-signings

  The report notes that real-time sales from the Bing Shuai Index usually lead official sales registrations by several weeks, so it uses this to monitor trends in secondary transaction volume and listing levels.

• Market sentiment indicatorsZhongyuan Dealer Confidence Index and Centa-Salesman Index

  Confidence index above 50 indicates slightly positive sentiment

  A Hong Kong CSI above 50 represents positive market sentiment and a higher likelihood of house price gains, but this period’s drop from 67.3 to 64.5 shows marginal cooling in momentum.

• Credit researchRelative value and fundamental credit rating framework

  Overweight/Neutral/Underweight credit views

  Credit ratings combine relative-value assessment with issuer fundamentals, including cash flow, leverage, interest coverage, liquidity, and asset quality.

Asset mapping & comparison

Structured mapping from thesis to named assets (strengths, weaknesses, peers, risks).

• Mainland China real estate equities

  Affected by secondary transaction levels, listing activity, net-signings, and policy expectations

  Strengths

  Secondary transactions are up Y/Y, first-tier listings are down, and the sector outperformed HSI by 1 percentage point last week.

  Weaknesses

  The improvement in primary net-signings may be partly driven by month-end concentration, and the quality of recovery still needs monitoring.

  Comparison

  The Mainland China real estate sector rose 4% last week, versus 3% for HSI.

  Risks

  If listings rise again or transactions weaken, the rationale for price stabilization may erode.

• Hong Kong property and conglomerates equities

  Affected by Hong Kong prices, transaction volume, CSI/CVI, and southbound flows

  Strengths

  Prices rose 12% in H1, CSI remains above 50, and selected rental stocks and conglomerates are top picks.

  Weaknesses

  Secondary transactions in 35 major estates are down 54% Y/Y, and both CSI and CVI have softened.

  Comparison

  The sector rose 2% last week, slightly below HSI’s 3%.

  Risks

  After prices reached near full-year targets, H2 gains may slow, and weak transactions could pressure valuations.

• Mainland China high-yield real estate credit

  Affected by sector risk appetite, issuer liquidity, and relative value

  Strengths

  The JACI China HY Property index is up 5.5% YTD; the report recommends LNGFOR ’29s and SHUION ’29s.

  Weaknesses

  Industry credit dispersion remains high, and developer liquidity events can still pressure risk premia.

  Comparison

  The JACI China HY Property index rose 0.16% last week, above China HY’s 0.03%.

  Risks

  Insufficient receivables, refinancing difficulties, or rating downgrades could cause bond price volatility.

• CK Hutchison Holdings credit

  Affected by asset disposals, deleveraging, and rating stability

  Strengths

  Moody’s affirmed A2 with stable outlook; asset disposals are expected to generate HK$97bn net cash, equal to 48% of adjusted net debt.

  Weaknesses

  Asset sales may reduce related earnings and cash flow, although the report says the impact is less than 10% of group-wide levels.

  Comparison

  The report keeps CKHH ‘41s at Overweight, pricing at 76.9 offer, yield 5.4%, SOT+96.

  Risks

  Execution risk, cash-collection timing, or steeper-than-expected profit declines after disposals.

Key data

• Bing Shuai Index 10-city real-time secondary weekly transactions+14% Y/YIt was +18% the prior week. First-tier cities rose 15% Y/Y, and Shanghai rose 20% Y/Y.
• First-tier city secondary listings-0.4% W/WShenzhen was down 2.2% W/W and Shanghai down 0.4% W/W; this is 3.5% below the March peak.
• Sixty-city primary net signings+27% Y/YIt was -8% Y/Y last week; the report says the prior figure was mainly affected by month-end transaction bunching.
• Twelve-city secondary net signings+12% Y/YYTD growth is 5% Y/Y, and Shanghai is up 14% Y/Y.
• Zhongyuan first-tier city secondary asking-price index16.6It fell from 17.0 to 16.6.
• Zhongyuan secondary dealer confidence index55It rose from 52 to 55; Shanghai rose from 48 to 52.
• Hong Kong CCL house price index+0.5% W/W; 1H26 +12%First-half gains have reached the annual 10-15% target range, and the report expects H2 gains below 5%.
• Secondary transactions in 35 major Hong Kong estates35 dealsUp 6% W/W but down 54% Y/Y.
• Hong Kong CSI64.5Down from 67.3 the prior week; still above the positive sentiment threshold of 50.
• JACI China HY Property index+0.16% W/W; YTD +5.5%China HY in the same period is +0.03%.

Impact & implications

From an investment perspective, Mainland China property’s marginal improvement appears to come more from declining secondary listings and transaction resilience than from a broad demand revival; this supports relatively stronger performance from high-quality developers and property-service leaders. Hong Kong’s residential market rose quickly in H1, but investors should remain cautious in H2 as transaction and sentiment indicators cool and may reduce price momentum. On credit, the report prefers bonds with deleveraging progress, stable fundamentals, or attractive valuation, such as CKHH ‘41s, LNGFOR ’29s, and SHUION ’29s.

Risks

• Hong Kong’s first-half price gains are near the full-year target, and if transaction activity remains weak, price momentum in H2 could fall short of expectations.
• The decline in Mainland first-tier secondary listings is an important support for price stabilization; if supply increases again, that stabilization argument may weaken.
• The YoY improvement in primary net-signings may be influenced by month-end concentration, potentially overstating true demand strength.
• Developers still face liquidity, financing, and receivables pressure, and credit bonds carry issuer-specific divergence risk.
• Southbound flows and short-term equity performance may be affected by macro rates, policy expectations, and market risk appetite.

What to watch

• Whether Mainland first-tier city secondary listings remain below the March peak.
• Whether Bing Shuai real-time secondary transactions continue to lead and confirm the improvement in official secondary net-signings.
• Whether Hong Kong CCL, CSI, and CVI continue to decline, and whether transactions in the 35 major estates recover.
• The true YoY trend of 60-city primary net-signings after month-end effects fade.
• Changes in southbound holdings in names including C&D, Greentown, Henderson, and Hang Lung Prop.
• The pace at which CKHH asset-disposal proceeds are converted to cash, and spread/yield changes for credits such as Longfor and Shui On Land.