Shanghai’s property market remains feeble

Shanghai's new housing market continued to lose its strength last week as the industry entered its low season.

The area of new residential properties sold, excluding government-subsidized affordable housing, fell 19.1 percent to 159,000 square meters during the seven-day period ended Sunday, Shanghai Centaline Property Consultants Co said in a report released today.

Citywide, Nanhui in Pudong New Area led all with weekly transaction volume totaling 34,000 square meters, mainly boosted by robust sales registered at a project in Lingang port area. Outlying districts of Songjiang and Jiadong followed closely.

These new homes sold for an average 42,315 yuan (US$6,204) per square meter, a week-over-week drop of 6 percent, according to Centaline data.

The retreat in price was mainly caused by strong sales at the Lingang development, which had a government-set price and was built for certain group of qualified buyers. A total of 362 apartments were sold last week for an average price of 9,068 yuan per square meter, making it the most sought after residential project across the city.

By price, two of the 10 best-selling projects asked for more than 50,000 yuan per square meter, with one of it bearing a cost of nearly 120,000 yuan per square meter, Centaline data showed.

On the supply side, only 44,000 square meters of new houses were released to the local market, a plunge of 76.7 percent from the previous week.

"We don't really expect a notable pickup anytime soon in homebuyers' sentiment," said Lu Wenxi, senior manager of research at Centaline. "However, it is possible that some real estate developers might increase supply in the coming few weeks as they might gear up to boost their first-half performance."