New homes in Shanghai cost more to buy despite cooling sentiment

New homes in Shanghai sold for an average cost exceeding 50,000 yuan (US$7,917) per square meter for the first time this year despite cooling sentiment among buyers, latest industry data showed.   

The area of new homes sold, excluding government-subsidized affordable housing, plunged 60.4 percent last week to around 67,000 square meters, Shanghai Centaline Property Consultants Co said in a report released today.

The city's outlying districts of Songjiang and Baoshan were the two most sought-after areas after 12,000 square meters and 9,000 square meters of new homes were sold, respectively.

The new homes cost 50,449 yuan per square meter on average, a week-over-week increase of 3.7 percent, according to Centaline data.

"A structural shift led to the price gain as more medium-end homes were sold during the seven-day period ended on Sunday," said Lu Wenxi, senior manager of research at Centaline. "The beginning of a month usually registers comparatively sluggish sales while the three-day Qingming Festival also affected sentiment among home seekers as well as real estate developers."

Four of the 10 best-selling developments cost above 50,000 yuan per square meter. A Poly Real Estate project in Baoshan, which sold 7,342 square meters, or 71 apartments, at an average 50,757 yuan per square meter, was the most popular. A project in Jinshan, which sold 41 units at 17,991 yuan per square meter on average, was the cheapest in the top 10 list.

On the supply side, 65,000 square meters of new houses spanning two projects were released to the local market — a sharp contrast to 394,000 square meters of supply launched in the previous seven-day period, Centaline data showed.

Notably, a high-end project in Jing'an released 319 units for sale with most units asking for between 80,000 yuan and 90,000 yuan per square meter, one of the most expensive developments in the local market recently.