--- title: "Wall Street discusses the surge in real estate stocks: Under policy expectations, \"bad news is good news\"" type: "News" locale: "en" url: "https://longbridge.com/en/news/248075392.md" description: "The National Development and Reform Commission has clearly allowed cities with population inflows to use ultra-long-term special government bonds and local special bonds to acquire existing housing and idle land. Morgan Stanley stated that this is the first time central funds have provided relief to the real estate sector, which will benefit the sector in the short term. HSBC also believes that the recent strong rebound in China's real estate sector is mainly due to investors' rapid reconstruction of policy expectations, \"bad news is good news.\"" datetime: "2025-07-11T01:12:09.000Z" locales: - [zh-CN](https://longbridge.com/zh-CN/news/248075392.md) - [en](https://longbridge.com/en/news/248075392.md) - [zh-HK](https://longbridge.com/zh-HK/news/248075392.md) --- # Wall Street discusses the surge in real estate stocks: Under policy expectations, "bad news is good news" As the signal for stabilizing the real estate market is released, HSBC and Morgan Stanley collectively express optimism about the rebound of China's real estate sector. On Thursday, July 10, a significant statement from the National Development and Reform Commission (NDRC) once again demonstrated the determination to stabilize the real estate market. According to a report by People's Financial News, the NDRC's Urban and Small Town Reform and Development Center recently stated, **"Allow cities with population inflows to utilize ultra-long-term special government bonds, local government special bonds, and other funds to increase the recovery of idle stock land and the acquisition of existing commercial housing, continuously expanding the supply of affordable housing for the agricultural transfer population."** On the same day, AH real estate stocks experienced a strong rebound, collectively triggering a surge in stock limits. An article from Wall Street View stated that the Shanghai Composite Index stabilized above 3,500 points, with A-shares such as Yukaifa and Nanshan Holdings hitting the upper limit; Hong Kong's property stocks surged even more rapidly, with companies like Dafang Guangruide and SINO-OCEAN GP rising by 30%, and Longguang Group, Hongyang Real Estate, and Greenland Hong Kong increasing by 20%. Regarding the unusual movements in Chinese real estate stocks, HSBC pointed out in its research report on Chinese real estate stocks released that day that **the recent strong rebound in the real estate sector is not driven by specific news but rather by a rapid reconstruction of market expectations regarding policies. Analysts believe that the market is embracing the logic of "bad to the extreme is good," and investors generally recognize the Chinese government's determination to stabilize the real estate market."** In other words, despite unsatisfactory real estate sales data, policy expectations are becoming increasingly strong. The bank believes that this consensus is driving funds to position themselves in advance, viewing the upcoming Politburo meeting at the end of the month as a critical policy window. However, the bank expects July to be a complex and volatile month. HSBC also stated that it will deepen bottom-up research to identify stocks that can maintain relative resilience even if sales momentum further slows, especially state-owned enterprises capable of monetizing existing assets and land reserves while continuing to reinvest in the land market. Not only one Wall Street investment bank is optimistic about the rebound of China's real estate sector. Regarding the NDRC's statement, **Morgan Stanley interpreted in its latest research report that this is the first time central funds have entered the real estate relief (referring to the first inclusion of ultra-long-term special government bonds for the acquisition of existing commercial housing and idle land), and short-term real estate stocks will benefit from this.** However, the bank believes that the impact on the fundamentals will highly depend on policy implementation, particularly key details such as the scale of funds, developer selection criteria, inter-city fund allocation, and repurchase pricing. ## Policy signals are being released Recently, the National Development and Reform Commission's Urban and Small Town Reform and Development Center stated that it aims to basically achieve the goal of new urbanization by 2035, to follow the rules, grasp the trends, and seize the key period where urbanization momentum remains strong, and to promote the four major actions of high-quality new urbanization to provide strong support for Chinese-style modernization Among them, efforts should focus on the use of "two 重" and "two 新" funds to increase investment in key areas of new urbanization. First, strengthen the construction of "two 重" projects, supporting the construction of significant projects that meet the conditions for the new round of agricultural transfer population urbanization, improvement of urbanization levels in potential areas, cultivation of modern metropolitan areas, urban renewal, and enhancement of safety and resilience, while expanding into key areas such as living environment, municipal facilities, and industrial support to address shortcomings in urbanization. Second, develop differentiated consumption policies for old, new, and new-generation agricultural transfer populations based on their consumption characteristics and needs, incorporating them into the special support scope of "two 新". **Third, allow cities with population inflow to utilize ultra-long-term special government bonds, local government special bonds, and other funds to increase the recovery of idle stock land and the acquisition of existing commercial housing, continuously expanding the supply of affordable housing for the agricultural transfer population.** ### Related Stocks - [002314.CN](https://longbridge.com/en/quote/002314.CN.md) - [03377.HK](https://longbridge.com/en/quote/03377.HK.md) ## Related News & Research - [Tencent Music completes $2.6 billion acquisition of podcast platform Ximalaya](https://longbridge.com/en/news/286841981.md) - [Metals Creek Resources Corp. 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