Real News‎ > ‎2014‎ > ‎June 2014‎ > ‎

23rd June 2014

Singapore Real Estate

JLL eyes more residential business in region

It just opened a new office in Malaysia through acquisition

Source: Business Times / Top Stories

[SINGAPORE] Global property consulting firm JLL, which is traditionally strong in office leasing and investment sales, is not letting up on its efforts to grow its residential services in South-east Asia, where it just opened a new office in Malaysia through an acquisition - the firm now wants to expand the pool of buyers in this region and bring in more products for these investors to capitalise on rising Asian affluence and investment appetite for real estate.

"At the moment, Asian investors in the global residential market are concentrated in Singapore, Kuala Lumpur, Hong Kong, Taiwan, China, Beijing and Shanghai. Our goal is to expand the base of buyers into cities like Jakarta and Bangkok," JLL managing director for Singapore and South-east Asia, Christopher Fossick, said in an exclusive interview.

"We would also like to expand into some Indian cities and Chinese cities."

According to Mr Fossick, investors prefer proximity and familiarity when choosing where to put their money, which is why many have invested in more transparent and mature markets such as London.

"In 2013, we started selling Tokyo properties. I think 2014 onwards, we will see more products from America, from New York and San Francisco, and more properties from Australia - Sydney and Melbourne in particular," he said.

JLL's capacity to serve its clients in the region was boosted when it opened a new office in Malaysia following a 49 per cent stake acquisition in YY Property Solutions Sdn Bhd this month. The Kuala Lumpur-based transaction and advisory firm has since been rebranded as JLL Malaysia.

Mr Fossick explained that the acquisition was "opportunistic" in nature to capitalise on the relaxation by Malaysian government on the cap for foreign equity in real estate.

"This is not due to a change in market outlook or opportunities in Malaysia," he said. "We are not taking short-term views. We think that Malaysia is a country that will continue to grow and provide opportunities."

JLL is hoping to double the team there from the current staff strength of 40 over the next two years. The team will focus on office leasing in Kuala Lumpur and investment sales. It will also look at providing residential sales services in the capital city.

Elsewhere in the region, Jakarta and Manila are the other hot spots, Mr Fossick said. Manila is growing as a business process outsourcing (BPO) centre and there is demand for residential upgrading. The demand for mid-priced affordable apartments in Jakarta from Indonesians is also picking up.

As for Singapore, which remains JLL's largest South-east Asian market, the residential market is becoming more challenging. But leasing demand for office space in both centralised and decentralised locations is supported by steady corporate growth and a balanced supply, Mr Fossick said.

There will be limited new office supply in the central business district until 2016 onwards when Marina One, the mixed-development in Marina South, Guoco Tower in Tanjong Pagar and mixed-use Project Jewel in Changi will come onstream.

Mr Fossick has been working in Asia for 25 years since he joined CBRE's Singapore and Asia office leasing teams and later became president and CEO of CBRE Japan, before joining JLL in Singapore in 2006 in his current role.

JLL has made a string of acquisitions here in the past few years. In 2011, it acquired DST International Property Services, which markets projects in Asia-Pacific, the US and the UK and in 2012, bought Credo Real Estate, which specialises in collective sales. Last year, JLL acquired boutique firm Halcyon Real Estate to beef up its strength in project residential leasing.

The success of these acquisitions came in the form of a 50 per cent jump in profits in Singapore. Strong market performances in Jakarta and Manila also aided a 33 per cent profit growth in South-east Asia.

"2013 had an exceptional growth that is hard to repeat," Mr Fossick said.

-By Lynette Khoo

Building noise gripes dip 1/3 since 2011 ban

Source: Straits Times

The clanging and clattering of construction work on weekends and public holidays has continued despite a 2011 ban on such noisy activities. It became compulsory then for all building projects to stop work from 10pm on Saturday until 7am on Monday or from 10pm on the eve of a public holiday until 7am the day after.

Vertical gardens' benefits go beyond dollars and cents

Source: Straits Times

Those who live or work in buildings with vertical gardens enjoy being closer to greenery, birds and butterflies, and feel inspired to lead more environmentally friendly lives, they say. Earlier this month, City Developments (CDL), the developer of the Tree House condominium in Bukit Timah, announced that its 24-storey vertical garden had clinched a Guinness World Record for being the world's largest.

Global Economy & Global Real Estate

China developers launching massive projects in Johor

They are betting on Iskandar Malaysia as the next Shenzhen

Source: Business Times / World

[KUALA LUMPUR] The growing presence of developers from China in Johor has ruffled the feathers of local developers. Following the high-profile entry of Guangzhou-based Country Garden Holdings Co Ltd, which launched 9,000 units in Danga Bay in one go in 2013, all eyes are now on other developers from China who are expected to adopt similar large-scale development programmes.

Country Garden made the first move in Johor Baru. It was followed by Guangzhou's R&F Properties Co (R&F), which bought 47 hectares near the Causeway from the Sultan of Johor for RM4.5 billion (S$1.74 billion).

R&F could be launching as many as 30,000 units over the next few years on land that is to be reclaimed, said a report in StarBizWeek

Agile Property Holdings Ltd is another China-based developer that is expected to make its presence felt in Johor Baru after it bought 1.3 ha from Tropicana Corp Bhd in Bukit Bintang, Kuala Lumpur.

-From Kuala Lumpur, Malaysia

Penang reclaiming land for new island

Source: Straits Times

THE northern coast of Penang is set to change dramatically following the state government's recent approval for a 308ha island to be built, to allow for more housing and recreational facilities. The mega reclamation project is being undertaken by Eastern & Oriental (E&O), a developer known for its luxury properties as well as the well-received refurbishment of Penang's famed E&O Hotel and Lone Pine Resort.

U.S. GDP, Housing Data, Nike, Wimbledon: Week Ahead June 23-28

Source: Bloomberg / News

The U.S. economy shrank in the first quarter at the fastest pace in five years, data this week may show.

U.S. durable goods probably fell in May while personal spending and home sales rose.

North Atlantic Treaty Organization foreign ministers will meet to discuss topics including Ukraine and relations with Russia.

Ukraine’s new president will sign his country’s association and free-trade agreement with the European Union.

EU leaders commemorate the 100th anniversary of the start of World War I.

Nike Inc. (NKE), Walgreen Co. (WAG), Accenture Plc (ACN) and Monsanto Co. (MON)are among companies reporting earnings.

The Wimbledon tennis grand slam starts in London and the soccer World Cup group stage will be completed in Brazil.


-Sales of previously owned U.S. homes probably increased in May to the highest level this year, according to a Bloomberg survey, as lower mortgage rates spurred buyers. The National Association of Realtors releases the data at 10:00 in Washington.

-U.S. Secretary of State John Kerry is among NATO foreign ministers meeting in Brussels to discuss topics including Ukraine, eastern Europe, relations with Russia, Georgian membership and Afghanistan. Closed meetings will be held for the first two days, and a press conference with Secretary General Anders Fogh Rasmussen is scheduled for 17:40 CET (11:40 EDT) on June 25.

-HSBC and Markit announce a preliminary reading of their China manufacturing purchasing managers’ index for June. May’s gauge rose to a four-month high, signaling the economy is stabilizing even as job cuts and weakness in the property market underscore pressure on the government to do more to support growth. 09:45 in Beijing (06/22 21:45 EDT).

-U.S. Congressional hearings on IRS. Internal Revenue Service Commissioner John Koskinen testifies before the House Oversight and Government Reform Committee, which is investigating the loss of more than two years of e-mails belonging to Lois Lerner, a former IRS official at the center of the controversy over the scrutiny of Tea Party groups. 19:00 in Washington.

-Polish Prime Minister Donald Tusk may be forced into early elections amid a political scandal caused by leaked conversations between top officials last week. The future of one of the officials, central bank Governor Marek Belka, is also under threat. Wprost magazine is due to release another recording of the conversations on June 23. Time to be determined.

-U.K. Prime Minister David Cameron holds talks with EU President Herman Van Rompuy in London to underline his opposition to the appointment of former Luxembourg Prime Minister Jean-Claude Juncker as the next head of the European Commission. Time to be determined.

-European Central Bank Vice President Vitor Constancio speaks at a conference in Frankfurt. 09:00 CET. (03:00 EDT)

-ECB Supervisory Chair Daniele Nouy speaks at a conference organized by the Irish Banking Federation. 09:25 in Dublin (04:25 EDT).

-ECB Executive Board member Yves Mersch speaks at a conference organized by the Gdansk Institute for Market Economics. 14:00 CET in Sopot, Poland (08:00 EDT).

-ECB Governing Council member Ewald Nowotny speaks at a conference in Vienna. 17:30 CET (11:30 EDT).

-Bank of Japan Governor Haruhiko Kuroda speaks at the Japan Association of Corporate Executives. 15:00 in Tokyo (02:00 EDT).

-Qatar ruler Sheikh Tamim Bin Hamad Al Thani visits France for talks with President Francois Hollande in Paris. The leaders will discuss Iraq, Syria and potential army contracts. Time to be determined.

-U.S. government bond auctions, Fed debt purchases. Click here for schedule.

-U.S. Supreme Court is in session for 2013-14 period. Click this line for the schedule.

-ECONOMY: Chicago National Activity Index (CFNAI) (May), Argentina GDP (PTGDPQOQ) (first quarter), Hong Kong inflation (May), Taiwan unemployment (May),Taiwan industrial production (May), Markit France PMI (June), Germany PMI (June), Croatia unemployment rate (May).

-CENTRAL BANKS: Angola rate decision may come as soon as today.


-The Wimbledon tennis tournament begins in southwest London. Andy Murray is seeking to defend his title, while seeded No. 3 behind Novak Djokovic and Rafael Nadal. Serena Williamsis the No. 1 seed in the women’s event. Click here for today’s match schedule.

-World Cup in Brazil. Click here for match schedule.

-U.S. baseball. The best-of-three-game College World Series finals begin in Omaha,Nebraska. 20:00 EDT. The final two games are June 24-25 at the same time.


-U.S. consumer confidence. The Conference Board releases its June gauge of consumer confidence. The index rose in May to the second-highest level since 2008 as Americans grew more upbeat about the economy and labor market. 10:00 in New York.

-New home sales in the U.S. probably increased in May to a four-month high, according to a Bloomberg survey, as buyers responded to cheaper borrowing costs. The Commerce Department reports at 10:00 in Washington.

-U.S. home prices in 20 cities probably rose at a slower pace in the year ended April, according to a Bloomberg survey. The S&P/Case-Shiller index is released at 09:00 in Washington.

-U.S. Treasury Secretary Jacob J. Lew testifies before the House Financial Services Committee on the annual report of the Financial Stability Oversight Council. 10:00 in Washington. Lew testifies before the Senate Banking Committee on the same topic tomorrow, June 25, at 10:00.

-James Clark, the U.S. Treasury Department’s deputy assistant secretary for federal finance, speaks on floating-rate notes at the Crane’s Money Fund Symposium. 11:55 in Boston.

-AT&T Inc.-DirecTV (DTV) merger. AT&T Chief Executive Officer Randall Stephenson and DirecTV CEO Michael White testify before the House Subcommittee on Regulatory Reform, Commercial and Antitrust Law on their proposed $48.5 billion merger. 10:30 in Washington. At 14:30, the Senate Subcommittee on Antitrust, Competition Policy and Consumer Rights also holds a hearing on the combination.

-U.S. Congressional primaries. In Mississippi, six-term Senator Thad Cochran is in danger of losing a Republican runoff to state Senator Chris McDaniel, after trailing by half of a percentage point in the June 3 primary. In New York’s 13th District, which includes parts of Manhattan and the Bronx, 22-term Democratic Representative Charles Rangel faces state Senator Adriano Espaillat. There are also primaries in Colorado, Maryland, Oklahoma and Utah. For all poll closing times click here.

-Bank of England Governor Mark Carney and officials Charlie Bean, David Miles and Ian McCafferty testify on the central bank’s May Inflation Report. 09:30 in London (04:30 EDT).

-Italian Prime Minister Matteo Renzi briefs both houses of parliament on his government’s plans for its six-month European Union presidency. Starts at 09:30 CET in Rome (03:30 EDT).

-Former Luxembourg Prime Minister Jean-Claude Juncker speaks on Europe’s global role at a conference in Berlin, a few days before EU leaders meet to consider proposing him as the next European Commission president. Starts at 11:15 CET (05:15 EDT).

-The ECB holds a public hearing on supervisory fees. 10:00 CET in Frankfurt (04:00 EDT).

-ECB Governing Council member Ewald Nowotny speaks to the Austrian parliament. 14:00 CET in Vienna (08:00 EDT).

-ECB Executive Board member Benoit Coeure speaks at a conference in Frankfurt. 15:50 CET (09:50).

-Hungarian Prime Minister Viktor Orban hosts a meeting with his Czech, Polish and Slovakian counterparts and EU Commission President Jose Barroso in Budapest starting at 10:00 CET (04:00 EDT).

-Portugal’s Finance Ministry releases the government’s year-to-date budget report. Time to be determined.

-Asiana Airlines Inc. crash. U.S. National Transportation Safety Board will rule on the probable cause of last July’s crash of an Asiana jetliner at San Francisco International Airport, in which three people died and 180 were injured. (09:30 EDT).

-ECONOMY: Brazil current account balance (May), U.K. BBA loans approved for house purchases (May), Swiss exports (May), German Ifo business confidence (June),Turkey capacity utilization (June).

-CENTRAL BANKS: Hungary rate decision, Turkey rate decision.

-EARNINGS: Walgreen Co.

-World Cup in Brazil. Click here for match schedule.

-Wimbledon tennis. Click here for today’s match schedule.


-U.S. GDP. The economy shrank in the first quarter at the fastest pace in five years, the Commerce Department’s third estimate of GDP may show. Economists marked down their latest estimate from a previously reported 1 percent contraction after a survey of services showed Americans spent less on health care than the government had assumed. 08:30 in Washington.

-Orders for U.S. durable goods probably declined in May for the first time in four months as demand for military equipment slowed. Bookings excluding transportation equipment are projected to increase, showing manufacturing is helping the economy bounce back from a first-quarter slowdown. The Commerce Department reports at 08:30 in Washington.

-U.S. IPO. GoPro Inc. (GPRO), the maker of equipment such a cameras used by surfers, skiers and sky divers, is seeking to raise as much as $427 million in an initial public offering. At the top end of the range, GoPro would be valued at $3 billion, data compiled by Bloomberg show. The company will list its shares on the Nasdaq Stock Market under the symbol GPRO. The stock will start trading on June 26.

-Obama-Peres White House meeting. Israeli President Shimon Peres, who is set to leave office in July, has lunch meeting with President Barack Obama to discuss the Middle East peace process and U.S.-Israeli relations. In Washington. Time to be announced.

-Google developers conference. Google Inc.’s annual conference will provide tools and advice to software makers on how to design programs for new products such as wearable devices. 09:00 in San Francisco (12:00 EDT). Through June 26.

-The London Bullion Market Association holds a seminar in Singapore. The speakers include LBMA CEO Ruth Crowell, David Gornall, LBMA chairman and global head of precious metals trading at Natixis SA, and Jeremy East, global head of metals trading at Standard Chartered Plc. 09:00 in Singapore (06/24 21:00 EDT).

-Australia’s Bureau of Resources and Energy Economics issues its quarterly report with price, production and export forecasts for iron ore, gold, nickel and bauxite. Australia is the world’s biggest exporter of iron ore, second-biggest gold producer and largest supplier of bauxite to China. 09:30 in Canberra (06/24 19:30 EDT).

-ECB Governing Council member Jens Weidmann speaks in Halle, Germany. 15:00 CET (09:00 EDT).

-ECB Governing Council Member Luis Maria Linde, also governor of the Bank of Spain, speaks at an event in Valencia. 14:00 CET (08:00 EDT).

-The U.S. Energy Information Administration releases its weekly oil supply report. 10:30 in Washington.

-ECONOMY: Brazil total outstanding loans (May), South Korea consumer confidence(June), U.K. CBI retail sales (June), Italy retail sales (April), Italy consumer confidence(June), Swiss UBS consumption indicator (May), German GfK consumer confidence(July), Netherlands GDP (NEGDPESQ) (first quarter, final), Spain producer prices (May),Russian weekly CPI, Ghana GDP (GAGDPYOY) (first quarter), Ghana producer-price inflation (May).

-EARNINGS: Monsanto Co., General Mills Inc., Bed Bath & Beyond Inc. (BBBY)

-World Cup in Brazil. Click here for match schedule.

-Wimbledon tennis. Click here for today’s match schedule.


-U.S. personal spending probably rebounded in May as job growth stoked wage gains, according to a Bloomberg survey, indicating consumers will provide a push for the economy in the second quarter. The Commerce Department will issue the statistics at 08:30 in Washington.

-The Bank of England publishes recommendations from the June 17 meeting of its Financial Policy Committee, which may include measures to cool the housing market. Governor Mark Carney holds a press conference in London with the publication of the semi-annual Financial Stability Review. 10:30 in London (05:30 EDT).

-The International Grains Council publishes its monthly supply and demand report for wheat, corn, rice and soybeans. 15:00 in London (10:00 EDT).

-EU leaders commemorate the 100th anniversary of the start of World War I and hold a dinner meeting in Ypres, Belgium. 17:00 CET (11:00 EDT).

-The U.S. Energy Information Administration releases its weekly natural gas supply report. 10:30 in Washington.

-ECONOMY: U.S. initial jobless claims (weekly), U.S. consumer comfort (weekly), Brazil unemployment (May), Hong Kong trade data (May), France consumer confidence(June), Poland retail sales (May), Poland unemployment rate (May), South Africa PPI (SAPRFMGY) (May).

-CENTRAL BANKS: Czech rate decision.

-EARNINGS: Nike Inc., Lennar Corp. (LEN), Accenture Plc.

-NBA draft. For the third time in four seasons, the Cleveland Cavaliers have the top pick in the National Basketball Association draft. 19:00 at the Barclays Center in Brooklyn.

-World Cup in Brazil. Click here for match schedule.

-Wimbledon tennis. Click here for today’s match schedule.


-Ukrainian President Petro Poroshenko is due to sign his country’s association and free-trade agreement with the EU, the rejection of which by ex-President Viktor Yanukovych triggered the street protests that overthrew him. Time to be determined.

-EU leaders meet in Brussels to discuss who will be the next president of the European Commission. They will also discuss Lithuania’s bid to adopt the euro and proposed 2030 climate and energy policies. Leaders also plan to sign association agreements with Georgia and Moldova. 09:00 CET (03:00 EDT).

-Japan reports May national consumer prices and Tokyo CPI for June. Core prices rose 3.2 percent from a year earlier in April after the sales tax was raised 3 percentage points to 8 percent. 08:30 in Tokyo (06/26 19:30 EDT).

-Bitcoin auction. The U.S. Marshals Service auctions 29,656 bitcoins the federal government seized last year in the illicit Silk Road marketplace. The sale starts online at 06:00 and the winner will be notified on June 30. The U.S. has seized a total of about 144,341 bitcoins worth about $86 million at current prices. The rest of the bitcoins will be auctioned at a later date.

-Portugal’s National Statistics Institute publishes its first-quarter report on GDP by institutional sector, which includes budget deficit figures. Timing to be confirmed.

-ECONOMY: University of Michigan U.S. consumer confidence (June, final), Japan jobless rate (May), Japan retail trade (May), China industrial profits (May), South Korea current account (May), South Korea industrial production (May), Brazil IGP-M inflation index (June), U.K. GDP (UKGRABIQ) (first quarter, final), U.K. GfK consumer confidence indicator (June), Italy business confidence (June), France GDP (FRGEGDPQ) (first quarter, final), France producer prices (May), German EU harmonized CPI (June), Spain retail sales (May), Spain CPI (SPCPEUYY) (June).

-SOVEREIGN RATING UPDATES: Austria (Moody’s), Cyprus (DBRS), Egypt (Fitch), Germany (Moody’s), Luxembourg (Moody’s), Slovenia (S&P).

-NHL draft. The Florida Panthers won the National Hockey League lottery, giving the team the right to choose first. 19:00 at the Wells Fargo Center in Philadelphia. Through June 28.

-Wimbledon tennis. Click here for today’s match schedule.


-World Cup in Brazil. Click here for match schedule.

-Wimbledon tennis. Click here for today’s match schedule.

-By Greg Miles, James Amott and Jim McDonald

JPMorgan Buys Larger Developers as Bubble Deflates: China Credit

Source: Bloomberg / News

JPMorgan Asset Management and Invesco Asset Management say China’s cooling property market is an opportunity to boost dollar bond holdings as the government’s targeted stimulus benefits the largest developers.

Chinese real-estate companies accounted for six of the 10 best-performing Asian notes in the past three months, according to a Bank of America Merrill Lynch index. The yield on 2018 debt of China Overseas Land & Investments Ltd., the nation’s largest developer by market value, dropped to 3.35 percent last week, from a record 4.31 percent on Feb. 5, while that on similar-maturity bonds of China Vanke Co. fell to 3.95 percent, from an all-time high of 5.07 percent on March 20.

“We will pick the winners from these trends,” said Stephen Chang, head of Asian fixed income at JPMorgan Asset, which oversees $39 billion in emerging-market debt. “Although sales and prices are falling along with margins, we have identified the larger developers are gaining market share and executing well.”

Premier Li Keqiang has pledged to safeguard this year’s growth target of 7.5 percent, fueling bets the government will encourage increased lending to selected projects and relax restrictions in the real-estate market. Larger developers may benefit from industry consolidation as smaller builders face a funding squeeze with a record amount of property trusts maturing next year and prices falling in the most cities in two years.

Softening Prices

Home prices declined in 35 of China’s 70 cities last month from April, the most since May 2012, official data showed June 18. In the financial center of Shanghai, prices decreased 0.3 percent, the first drop in two years, while they fell 0.2 percent in the southern business hub of Shenzhen.

“Softening prices are good because they imply there isn’t a bubble anymore,” said Ken Hu, Hong Kong-based chief investment officer of fixed income for Asia Pacific at Invesco, which manages $787 billion globally. “We pick developers with high turnover and those who tend to build smaller-sized flats. Profit margin isn’t that key to bondholders like us. Our approach is to buy on dips.”

Developers including Vanke that cut prices by 10 percent to 15 percent achieved good sales volume, Deutsche Bank AG analysts led by Hong Kong-based Tony Tsang wrote in a June 13 report. Vanke, headquartered in Shenzhen, recorded a 16.2 percent increase in sales value in the first five months of 2014 from a year earlier, it said in a June 3 statement to the Shenzhen stock exchange.

Taking Advantage

Larger industry players are able to tap overseas capital markets for funds. Sales of dollar bonds by Chinese companies totaled $91 billion in 2014, compared with $89 billion in the previous year, according to data compiled by Bloomberg.

Smaller builders, which rely on property trusts for financing, have to repay 203.5 billion yuan($32.7 billion) in 2015, according to research firm Use Trust. That’s almost double the 109 billion yuan due this year. China’s banking regulator said on June 6 it will monitor developer finances, a sign of concern defaults may spread after the March collapse of Zhejiang Xingrun Real Estate Co., a builder south of Shanghai.

“It won’t be surprising to have a few defaults in the sector in an economic slowdown, given you have thousands of developers and many of them are small ones,” BOCI’s Wang said. “The bigger ones, especially those listed, can take advantage to lower their funding costs as the industry consolidates.”

China South City Holdings Ltd. (1668), which runs logistics parks for industrial materials, sold 1 billion yuan of five-year bonds at a coupon of 7.5 percent in the interbank market on May 9. It plans to use the proceeds to repay short-term bank loans. Greenland Holding Group has hired banks to arrange investor meetings from today for a potential dollar bond offering, according to a person familiar with the matter.

Borrowing Costs

Vanke’s bond borrowing costs dropped to 3.45 percent on a weighted average last week, compared with 5.5 percent in the first quarter of 2011, according to data compiled by Bloomberg. It also managed to extend the average maturity of its notes to 3.95 years, from 2.43 years in 2011.

Slowing growth is causing declines in the yuan and onshore interest rates. The Chinese currency has fallen 2.8 percent against the dollar this year, the worst performance in Asia. The yield on the benchmark 10-year government bond has dropped 52 basis points to 4.04 percent in the same period as investors sought safe havens. Gross domestic product will probably expand 7.3 percent this year, the slowest pace since 1990, according to a Bloomberg survey.

Prolonged Downturn

The downturn in the property market will be more prolonged this time than in previous corrections,Tom Byrne, senior vice president at Moody’s, said at a June 19 conference in Shanghai. Broad price cuts are likely to come in late August or in September when more new projects are set to be introduced, UBS AG Hong Kong-based analyst Eva Lee wrote in a report last week.

Moody’s revised its credit outlook for Chinese developers to negative from stable on May 21. The Shanghai Stock Exchange Property Index, which tracks 24 real-estate companies listed in the city, has slumped 6.3 percent this year, exceeding the 4.2 percent decline for the benchmark Shanghai Composite Index.

“Overall, the housing market is cooling in some parts, like in third- or fourth-tier cities,” said Chang at JPMorgan Asset. “But we do see a silver lining. There’s actually a healthy pickup in transactions at specific locations after some discounting.”

’Minor Stimulus’

The nation has introduced measures to help the real-estate industry, which JPMorgan Chase & Co. says poses the biggest near-term risk to growth in the world’s second-largest economy. The People’s Bank of China told 15 banks in May to improve efficiency of service, give timely approval and distribution of mortgages to qualified buyers. The southeastern city of Fuzhou has removed home-purchase limits for buyers who make one-time payments, the Securities Times reported on June 18, citing sales people from two developers.

The government may announce additional “minor stimulus measures” after Premier Li said in London last week that the nation will maintain a minimum growth rate of 7.5 percent, according to a China Securities Journal commentary on June 20. The PBOC may release more targeted steps to prevent expansion from falling short of the goal, it added.

“Policy makers are actually putting out more measures to support this sector,” said Arthur Lau, Hong Kong-based head of Asia ex-Japan fixed income at PineBridge Investments, which oversees about $71 billion. “I think, volume-wise, it could catch up a little bit in the second half, especially those who are not aggressively buying land. There is still a wide selection, even within this sector.”

-By Fion Li