The Hang Seng Index rose over 400 points today (May 10), reaching 18,963 points and hitting a new high for the year. Regarding sector performance, property stocks experienced a significant surge, with Shimao Group (00813) rising 60% and China Resources Land Ltd (01109) increasing by over 7%, significantly driving market sentiment. Christina Ngai, a senior financial advisor, believes this is related to the recent announcements of comprehensive cancellation of home purchase restrictions in Hangzhou and Xi'an.
So far, 35 cities in mainland China have relaxed home purchase restrictions, and 24 cities have lifted such limits. Apart from the four first-tier cities of Beijing, Shanghai, Guangzhou, and Shenzhen, Tianjin and Hainan Province are the only places on the mainland that still impose restrictions on housing purchases.
Christina Ngai believes that the relaxation of real estate policies in Hangzhou and Xi'an serves as a signal, "in the future, we should pay attention to whether transaction volumes and prices can increase and whether the market can return to normal," Christina Ngai said.
She also points out that over the past year, we have seen that most property stocks or property companies are undergoing debt restructuring. Typical debt restructuring plans often include debt-to-equity conversion clauses. Ngai believes that driven by real estate policies, the property sector is becoming more stable, which will positively promote debt-to-equity conversions for real estate companies.
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