New home sales retreat

Shanghai's new home sales market retreated last week amid a drop in new supply, latest market data showed.

The area of new residential properties sold, excluding government-subsidized affordable housing, fell 12.6 percent to about 135,000 square meters during the seven-day period through Sunday after two weeks' moderate rebound, Shanghai Centaline Property Consultants Co said in its regular Monday report.

"An off-season factor, coupled with a frequently seen retreat during the beginning of a month, contributed to last week's subdued performance," said Lu Wenxi, Centaline's senior research manager. 

"However, the market still remained generally stable with the weekly transaction volume staying above the 100,000-square-meter barrier," Lu said.

Across the city, the remote Jiading District emerged as the most sought-after area with seven-day sales reaching some 22,000 square meters. 

Qingpu District, which had maintained its top 1 position for several consecutive weeks, saw its sales fall 11.1 percent to around 16,000 square meters.

The average cost of a new home dipped 0.6 percent from a week earlier to 52,937 yuan (US$7,514) per square meter, Centaline data showed.

In last week's top 10 list by area, three cost more than 50,000 yuan per square meter, one less than the previous week. 

A residential development in Jiading outperformed all after selling 12,472 square meters, or 124 apartments, for an average price of 30,484 yuan per square meter. 

Notably, a luxury project in downtown Huangpu District, with a price tag of over 110,000 yuan per square meter, grabbed the No.3 position after unloading 2,819 square meters, or 9 units, according to Centaline data.

On the supply side, only some 105,000 square meters of new houses spanning three projects, all beyond the Outer Ring Road, were released into the local market, a week-over-week dive of 36.3 percent.

"A rebound in new supply should be expected pretty soon as tightening measures will remain strictly in place as the central government has already made it very clear," Lu said. "It, therefore, will be wise for real estate developers to land more home buyers as early as possible for better sales in the second half."

The country will adhere to the principle of "housing is for living, not for speculation," implement the long-term mechanism to maintain the sound development of the real estate market, and not use real estate as a short-term means of stimulating the economy, the Political Bureau of the Communist Party of China Central Committee affirmed during a meeting held last week.