We expect the tightening policy environment to continue before more signs of growth moderation in both property and land prices are visible. We see more pressure on mortgage loan growth, and expect the net increase amount to decline by 10.5% YoY over 2Q-4Q21E to sustain the exposure at the level as at end-2020. With more quota control, the rising mortgage loan rate is set to continue.

Developers’ saleable resources have turned more stretched, with landbank duration trimmed to 2.8 years after the slowdown in land acquisition. This exerts more constraints on developers’ new launches and translates into higher requirements on developers’ landbanking capabilities, the latter of which remains challenging amid intense competition even under the ‘two concentration’ land supply reform.