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<Research>JPM: CN New Tax Policies May Support CN Home Sales in Short Term
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The Ministry of Finance (MOF), the State Administration of Taxation (SAT) and the Ministry of Housing and Urban-Rural Development (MOHURD) of China jointly released a new tax policy to promote the stable and healthy development of the real estate market, including increasing the concessions on deed tax for home transactions, and proposed to reduce the LAT prepayment ratio, besides lowering the transaction costs for buyers and sellers, which are expected to help ease the cash flow pressure of developers, JPMorgan released a research report saying. Although JPMorgan believed that the new tax policy will not significantly change the current situation of China's property market, it is expected to help boost sales, and property prices in first-tier cities are expected to rise further in the next 1-2 months. The frequent introduction of supportive policies by the authorities from September also shows that the central government has become more determined to stabilize the property market, the broker added. As for the performance of Chinese developers, the broker believed that the rebound in share price may not be sustainable unless there are stronger policies in place, such as a larger scale purchase of existing home. At the moment, JPMorgan was more bullish on CHINA RES LAND (01109.HK), CHINA OVERSEAS (00688.HK), CHINA RES MIXC (01209.HK) and POLY PPT SER (06049.HK), all of which are rated at Overweight. AAStocks Financial News |
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