Shanghai's new housing market sees first batch of supply in four weeks but buying sentiment remains weak

Shanghai's new housing market recorded its first batch of supply in four weeks while home-buying sentiment continued to be slack.

The area of new homes sold, excluding government-subsidized affordable housing, fell 4.2 percent to 87,000 square meters in the seven days ended Sunday, Shanghai Centaline Property Consultants Co said in a report today.

Outlying Jiading and Qingpu districts kept their leading positions with both posting weekly transactions at around 14,000 square meters. That, however, was a plunge of 33.3 percent and 17.6 percent, respectively, from the previous week.

"New supply finally returned to the city's new home market after staying at zero for three consecutive weeks, which was very rare," said Lu Wenxi, senior manager of research at Centaline. "Though only one project was released to the local market, that might still herald a recovery of developers' sentiment."

One housing project in Anting, Jiading District, launched some 45,000 square meters of new houses for sale last week, most of which were apartments whose areas were between 75 and 107 square meters.

Notably, it was the first housing project in Shanghai where a lottery-like registration system was implemented to decide the purchasing orders of home buyers — a latest effort by the local government to protect the rights and interests of buyers as well as to crack down on illegal sales in the real estate market.

New homes sold for an average of 50,060 yuan (US$7,515) per square meter, up 8.6 percent weekly, Centaline data showed.

Citywide, units in seven of the 10 most popular projects cost between 40,000 yuan and 60,000 yuan per square meter and there was only one development whose units cost under 30,000 yuan per square meter each.

A Yanlord project in Pudong New Area emerged as the most sought-after development after selling 5,698 square meters, or 28 units, for an average price of 54,521 yuan per square meter.

It was followed by a project in Jiading where 16 homes, covering 2,129 square meters, were sold for an average 48,084 yuan per square meter.