Shanghai home market rebounds sharply over past week

New home sales doubled in Shanghai last week as the market returned to normal activity with several outlying districts recording robust turnover.

The area of new residential properties sold, excluding government-funded affordable housing, jumped 99.8 percent to around 171,000 square meters during the seven-day period through Sunday, Shanghai Centaline Property Consultants Co said in its latest weekly report.

Across the city, Jiading District outperformed all with transactions hitting 35,000 square meters. It was most immediately followed by Qingpu and Fengxian districts, where some 25,000 square meters and 21,000 square meters of new houses were sold respectively.

"Major recovery in Jiading and Qingpu, two traditional districts where demand for new homes is usually strong, particularly among first-time buyers, indicated that the market has returned to its normal state," said Lu Wenxi, Centaline's senior research manager. "In contrast, demand in the Pudong New Area, which is often popular among upgrading home seekers, seemed rather slack with less than 10,000 square meters of new homes being sold in the area over the past week."

The average cost of a new home fell 12.3 percent from a week earlier to 47,782 yuan (US$6,757) per square meter amid a structural shift, setting a year-to-date low in the city, Centaline data showed.

In the top 10 projects by sales, six cost less than 50,000 yuan per square meter. One project in Jiading with a price tag of 52,015 yuan per square meter dwarfed all others after selling 26,895 square meters, or 272 units. It was most closely followed by a development in remote Chongming Distrct, which unloaded 8,442 square meters, or 64 units, for an average price of 21,719 yuan per square meter.

Only one luxury project, located in Pudong with a price tag of over 120,000 yuan per square meter, was ranked among the top 10 after selling 2,734 square meters, or 15 units, during the seven-day period.

On the supply side, eight projects totaling 220,000 square meters of new homes were released into the local market, compared with some 140,000 square meters launched in the previous week, according to Centaline data.