Worst not over for Chinese property sector, JPMorgan investor survey shows

LONDON (Reuters) – The worst of China’s property crisis is not yet over, a survey of Chinese and international investors carried out by JPMorgan has shown.

China’s property woes have continued to mount in recent weeks as major developers like Country Garden and state-backed Sino Ocean have teetered close to an Evergrande-style default.

“Unsurprisingly, most investors are bearish,” JPMorgan’s analysts said in a summary of the survey published on Friday.

It was the first time the investment bank had conducted the survey. It showed 55% of those who took part believed the market was “still at the trough” of its crisis, with only 26% of respondents of the view that the worst is now past.

There was no major discrepancy between Chinese and international investors’ views, they added.

Around 60% of respondents expected firms’ share prices to rise over the next three months, although only 16% said they were more likely to increase their positioning.

“Ineffective policy responses” meanwhile was viewed as the biggest concern, followed by a spillover into the banking system, a double dip in property sales, and a significant slump in home prices.

Respondents are still unconvinced that recent support measures will be enough to steady the situation. Just over 40% had a “neutral view” on whether these easing measures will boost property sales over the next 3-6 months.

Going forward, only 17% expect Beijing to provide very strong stimulus, while the majority, or 65%, expect regional or local governments to gradually increase support.

(Reporting by Marc Jones; Editing by David Holmes)