New home buying sentiment remains strong

New home buying sentiment remained strong in Shanghai last week despite a double-digit withdrawal from the previous seven-day period as real estate developers geared up during the last few days of 2020 to boost yearly sales.

The total area of new residential properties sold, excluding government-subsidized affordable housing, fell 13.7 percent week over week to around 371,000 square meters, Shanghai Centaline Property Consultants Co said in its weekly report on Monday.

Leading the pack was Nanhui, a former district and now part of the Pudong New Area, which registered sales of some 67,000 square meters. Qingpu and Fengxian districts followed with weekly transactions of 60,000 and 50,000 square meters, respectively.

The average price of new homes fell 4.2 percent from the previous week to 49,802 yuan (US$7,644) per square meter, with the most expensive project on the top-10 list by sales selling for a little over 61,000 yuan per square meter.

"The number of districts seeing sales above the 10,000-square-meter threshold remained unchanged at nine last week while eight projects recorded weekly transactions of more than 100 units," said Lu Wenxi, Centaline's senior researcher. "There's some sign of panic buying as home seekers rushed to finish their purchases in fear of price increases in the year ahead."

Three residential projects, all in remote areas, managed to sell more than 200 units each over the past week with one in Nanhui, priced at around 59,000 yuan per square meter, dwarfing the other two by selling 31,195 square meters, or 290 units, according to Centaline.

Among the top 10 developments by sales, four were priced at more than 50,000 yuan per square meter, while the cheapest cost at just over 22,000 yuan per square meter.

On the supply side, only one project, or some 19,000 square meters of new homes, were rolled out into the local market, a sharp contrast to about 306,000 square meters of new housing coming online the previous week.

Some 166,000 square meters of new houses were sold during the three-day New Year holiday ended on Sunday, which was equivalent to an average weekly volume and might possibly herald a good start for 2021, Lu said.