May new home sales pick up after slight retreat

May got off to quite a promising start despite a retreat in sales from the previous week as medium to low-end projects in remote areas continued to lure buyers.

May got off to quite a promising start despite a retreat in sales from the previous week as medium to low-end projects in remote areas continued to lure buyers.

The area of new residential properties sold, excluding government-subsidized affordable housing, fell 25.4 percent week on week to around 138,200 square meters during the seven-day period ended on Sunday, Shanghai Centaline Property Consultants Co said in a report released today.

"Despite the week-over-week drop, the seven-day transaction volume was still good if we take into consideration that a retreat occurs pretty often at the start of a month as real estate developers usually gear up for sales during the closing days of a month to boost their performance," said Lu Wenxi, senior manager of research at Centaline.

Citywide, outlying Qingpu, Jiading and Songjiang were the three most sought-after areas during the week where new home sales totaled 28,500 square meters, 27,400 square meters and 20,700 square meters respectively, Centaline data showed.

The average cost of new houses fell 4.5 percent from the previous week to 44,803 yuan (US$5,876) per square meter, mainly due to a structural shift.

Two of the 10 best-selling projects, including the second-most popular development, sold for less than 30,000 yuan per square meter.

By project, a residential development in Jiading sold 20,104 square meters, or 240 units, last week for an average price of 30,102 yuan per square meter, becoming the most popular project of the week.

Notably, three other projects also managed to register weekly sales of more than 100 units, a rare thing in the current market.

"That was obviously a very positive sign for continuously recovering momentum among home buyers," Lu said. "We therefore feel quite upbeat about May's overall new home sales which might exceed 700,000 square meters if the current momentum is maintained."

About 23,900 square meters of new residential properties spanning two projects were launched last week, a dive of 92 percent from the previous week, according to Centaline data.

New home supply totaled around 9,100 units in Shanghai this April, and some 2,600 units, or less than 30 percent, were sold during the same month, Shanghai Homelink Real Estate Agency Co said in a separate report.


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