Mainland property sales to fall 10pc, says HSBC

HSBC (0005) expects property sales in the mainland to drop 10 percent year-on-year in 2020 as several cities have required developers to close sales offices and stop construction amid fears of the fast-spreading SARS-like coronavirus.

HSBC said the closure of sales offices will hamper housing demand and the suspension of construction will impact the developers' cash flow, which increased uncertainties for the profit outlook of mainland developers this year.

Meanwhile, more than ten mainland property developers have pledged to slash rents for tenants in shopping malls, as the novel coronavirus infection spreads. Longfor (0960) said will halve rents, property management fees and promotion fees for all tenants in its shopping malls from January 25 to March 31, which is estimated to benefit more than 4,500 brands.

More than 60 mainland property developers, including China Vanke and Country Garden, have made donations to Wuhan, the epicenter of the viral outbreak, mainland media China Real Estate Business reported.

Previously, Wanda has said it will exempt rents and property management fees for the tenants in all the Wanda Plaza shopping malls across the mainland and expects to receive 3-4 billion yuan (HK$3.36-4.48 billion) fewer in rent.