Remember all those worries about a China property crash? Forget all that. Analysts are turning freshly positive on the mainland's listed property plays.
"National property sales in April are likely to record the first year-on-year increase in 2015, pointing to a potential bottoming-out," Barclays said in a note Monday, citing data showing home sales in 32 cities tracked by the bank rose 28.3 percent on-year over April 1-28. "Chinese property bond yields have also declined sharply, suggesting that investors are becoming less concerned over developers' cash-flow positions, and we believe lower market risk premiums are warranted."
Valuations in the sector's stocks are "still quite attractive" at around 9.4 times earnings for Hong Kong-listed plays, Barclays said, noting the last two sector rallies resulted in gains of 110-258 percent. It upgraded Longfor, Agile and Greentown to Overweight.
China property plays are already rallying, with the Hang Seng Property index up around 20 percent so far this year – and around 2.4 percent mid-trade Monday – and the Shanghai Property subindex up around 3.9 percent midday Monday, totting up gains of around 42 percent so far this year. That compares with the Hang Seng Index's around 20 percent year-to-date gain and the Shanghai Composite's around 38 percent rise over the same period.