Coronavirus batters Shanghai property market

Cao Qian
New home sales took a serious downturn last week, with turnover falling by over 30 percent and zero new supplies. Average price also dropped by more than 20 percent.
Cao Qian

Shanghai's new home sales dropped significantly last week, when 11 districts registered zero transactions, the latest market data show.

The total area of new residential properties sold, excluding government-funded affordable housing, fell 32.3 percent week over week to 3,978 square meters during the seven-day period ending Sunday, Shanghai Centaline Property Consultants Co said in its regular weekly report released on Monday.

Across the city, the former Nanhui District was the only area to see sales exceed 1,000 square meters, with none of the rest reaching above 700 square meters.

In Nanhui, a total of 2,196 square meters of new homes were sold last week. Qingpu and Baoshan districts followed most closely with weekly transactions of 607 square meters and 393 square meters, respectively, according to Centaline data.

The average price of a new home, meanwhile, plunged 21.8 percent from the previous week to 40,179 yuan (US$5,736) per square meter, the lowest weekly figure in about three years.

“That price drop was mainly due to a structural shift as more low-end products were unloaded last week,” said Lu Wenxi, Centaline's senior research manager.

Three developments in Nanhui, priced between 25,586 yuan and 45,864 yuan per square meter, grabbed the top three spots in last week’s best-selling list, Centaline data show.

On the supply side, not a single new home unit was released into the local market during the previous seven-day period, the fourth consecutive week with zero new supply.

“The Spring Festival holiday coupled with the outbreak of novel coronavirus pneumonia jointly dampened developers’ momentum,” Lu said. “We don’t expect any new supply to come into the market until March with the continued impact of the virus.” 

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