Cooling sentiment among Shanghai home buyers

NEW home transaction retreated in Shanghai for the first time in four weeks along with somewhat cooled down sentiment among real estate developers, latest market data showed.

The area of new residential properties sold, excluding government-subsidized affordable housing, fell 11 percent to about 83,000 square meters during the seven-day period through Sunday, terminating a three-week rally after the Spring Festival holiday, Shanghai Centaline Property Consultants Co said in a report released today.

Around the city, projects in outlying areas targeting budget-tight home seekers continued to dominate last week's new home sales. Jiading, which registered a week-over-week increase of 15 percent, became the most sought-after area after unloading some 23,000 square meters of new houses. Qingpu followed closely with some 15,000 square meters of new home sales, a surge of 87.5 percent from the previous week.

These new homes cost an average 44,533 yuan (US$7,023) per square meter, a week-over-week increase of 4.7 percent, according to Centaline data.

"Projects asking for between 30,000 yuan and 40,000 yuan per square meter remained the most popular among buyers with six out of the 10 best-selling developments falling into that range," said Lu Wenxi, senior manager of research at Centaline. "And two projects selling below 30,000 yuan per square also made into the top 10 list."

A China Vanke project in Xujing, Qingpu, which sold 37 apartments last week for an average 58,584 yuan per square meter, was the most expensive one in the top 10 list.

On the supply side, not a single unit was released to the local market, compared with some 55,000 square meters launched during the previous week, Centaline data showed.

"Zero supply should probably leave some negative impact on sales for the second half of March, a month that usually sees the first major rebound in a year for property sales," Lu said.