E House Holdings (EJ): Holding its own in the Chinese housing bubble 

By Paul Goodwin, Analyst and Editor of Cabot China & Emerging Market Report
From Cabot Wealth Advisory, 4/9/09 Sign up for free Cabot Wealth Advisory e-newsletter

E-House Holdings (EJ) is a leader in the Chinese real-estate market.

Chinese real estate experienced its own bubble in 2007-2008, with massive development in both the residential and commercial sectors and rapidly inflating prices. With most housing sales in China still being made mostly in new housing to first-time buyers, E-House has been more of a marketing agency for newly completed developments than a real-estate agency as we think of it in the U.S. The bursting of the Chinese bubble has left a huge backlog of housing on the market, and there won’t be much price movement until demand can chew its way through that inventory.

But E-House is holding its own today, and when the market returns to a normal balance of supply and demand, the company’s wholly owned exclusive housing and commercial real estate database will become a vital (and marketable) tool for all agents. It’s as if E-House had exclusive rights to the Multiple Listing Service in the U.S.

EJ has been through a horrendous dive, falling from its high of 36 in late 2007 to a low of 4 last November. Since then, it has fought its way back to 8, then spent three months building a new base between 6 and 8. It has broken above 8 on good volume and should put in a little time under 10 to recharge its batteries. It looks good to me. 

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Paul GoodwinPaul Goodwin
Emerging Markets Specialist, Analyst and Editor of Cabot China & Emerging Markets Report

A researcher and writer for over 30 years, Paul Goodwin has been a member of the Cabot investment team and editor of Cabot China & Emerging Markets Report since 2005. Under Paul’s stewardship, Hulbert Financial Digest rated Cabot China & Emerging Markets Report the number-one-rated newsletter of 2006 with a 78.6% gain for the year, the number-one-rated newsletter of 2007 with a 74.1% return, and the top-performing investment adivsory for five years with a 17.9% annual return.