'Rollercoaster' ride for city's housing market in H1

Shanghai's new home sales market registered a somewhat "rollercoaster" ride in the first half of 2022 with demand for larger and high-end homes remaining robust among buyers.

Purchases of new residential properties, excluding government-funded affordable housing, plunged 31.8 percent year on year to 3.78 million square meters during the first six months, data released by Shanghai Centaline Property Consultants Co showed on Tuesday.

"Boosted by an ample supply, 2022 was off to a strong start but quickly lost its steam in February which was a typically low month for property sales mainly due to the Spring Festival holiday," said Lu Wenxi, a senior researcher at Centaline.

"An unexpected resurgence of COVID-19 then started to bite the local market from March, which didn't bottom out until June when a two-month citywide lockdown was finally lifted."

A separate report released earlier by Shanghai Homelink Real Estate Agency Co showed that some 33,089 units of new homes were sold across the city during the first six months, a drop of 33 percent from the same period a year ago. By value, new home sales totaled 247.9 billion yuan (US$37 billion), a decrease of 20 percent from the first half of 2021.

The expansive Pudong New Area, which recorded six-month new home sales of 1.18 million square meters, continued to be the main driver of the market.

The suburban districts of Songjiang, Baoshan and Qingpu, as well as downtown Hongkou District, were among the other leading performers for the first half, according to Centaline.

"Noticeably, buyers seeking an upgrade seemed to be the major players of the market during the first six months, with 48 percent of new homes sold during the period falling into the 90-to-110-square-meter category, a year-on-year increase of 7 percentage points," said Yang Yulei, a senior analyst at Homelink.

"By price point, meanwhile, the proportion of new homes fetching more than 6 million yuan rose by 15 percentage points, with those bearing a price tag of above 10 million yuan gaining 7 percentage points."

On average, new homes sold in Shanghai during the first half of this year cost 7.49 million yuan, or 65,572 yuan per square meter, an increase of 20 percent and 18 percent, respectively, from same period a year ago, which was basically a result of structural shift in new supply, according to Homelink.