New home sales rebound in Shanghai amid supply rise

New home sales rebounded in Shanghai last week amid an increase in supply, pointing to signs of a market recovery.

The area of new homes sold, excluding government-subsidized affordable housing, jumped 24.2 percent to about 84,000 square meters during the seven-day period ending on Sunday, Shanghai Centaline Property Consultants Co said in a report released today.

But the average price of the new homes fell 6.3 percent week on week to 47,255 yuan (US$7,512) per square meter.

The city's remote Songjiang District remained the most sought-after area for the second consecutive week after weekly transactions surged 66.7 percent to 20,000 square meters. It was closely followed by outlying Qingpu District where 10,000 square meters of new homes were sold and Jiading District's 9,438 square meters.

"The local new home market has been gaining strength moderately," said Lu Wenxi, senior manager of research at Centaline. "A well-established luxury housing project in downtown Xintiandi area launched more than 42,000 square meters into the market in one batch."

Lakeville, a development of Shui On Land, released 118 apartments last week at an average price of between 120,000 yuan and 190,000 yuan per square meter, according to Centaline data. The price range is almost equivalent to that of an earlier batch released in November 2015.

The total new supply released to the market surged 50.7 percent week on week to 98,000 square meters last week.

Eight of the top 10 best-selling projects sold for above 40,000 yuan per square meter with the most expensive development, located in former Zhabei District, costing around 85,000 yuan per square meter, according to Centaline data.

For the second half of this month, at least 11 projects with around 4,900 units will be launched for sale citywide, a separate report by Shanghai Homelink Real Estate Co said. These units will lift April's total new home supply to over 6,500 units — the highest since 2017.