JPMorgan noted in a research report that over the past three trading sessions, China's mainland and Hong Kong property sectors rose 7% and 5%, respectively, outperforming the Hang Seng Index's 3% gain. The bank attributed the mainland property stocks' rally primarily to heightened policy expectations, with the outperformance likely to persist until the next government meeting in late November or December. However, if no new policy narratives or measures emerge by then, the sector may underperform again.

Currently, industry fundamentals suggest increasing probability of fresh policy support. The bank maintains its top picks as China Resources Land (01109), China Resources Mixc Lifestyle (01209), and China Jinmao (00817). Among policy-driven rebounds, Longfor Group (00960) offers the most attractive risk-reward profile.

For Hong Kong property stocks, the rally reflects growing confidence in a market recovery. While the bank remains positive on the sector, residential developer valuations already price in a full recovery. For instance, SHK PPT (00016) trades near historical highs on a dividend-adjusted basis, despite secondary home prices remaining 26% below peak levels.

At this stage, JPMorgan sees better risk-reward in Hong Kong REITs, favoring Swire Properties (01972), Hang Lung Properties (00101), Link REIT (00823), and Wharf REIC (01997). Among developers, it prefers Sino Land (00083) and Henderson Land (00012).