China property stocks may extend gains as home prices in the world’s third-largest economy outstrip analyst estimates amid demand for better housing, Henderson Global Investors’ Andrew Mattock said.

'The whole upgrade cycle for property in China probably still has a long way to run,' Mattock, a Singapore-based fund manager at Henderson Global, which oversaw about $81 billion at the end of last year, said in an interview yesterday. 'There’re lots of people out there who want to have a better-looking house than they have got.'

Mattock’s top picks include Guangzhou R&F Properties, whose shares have climbed 93% in Hong Kong this year and Shimao Property Holdings Ltd., up 143%. Mattock oversees the $67.4m Horizon China Fund, which has gained 83% this year through 22 June. That’s more than the 32% rally by the MSCI Golden Dragon Index, which tracks stocks listed in China, Hong Kong and Taiwan.