Shanghai Real Estate Prices Drop to Lowest Level in Nine Months

According to a research report released by Shanghai Deovolente Realty Co, the average price of residential real estate in Shanghai dropped to its lowest level since March during the week of 12 December.  The price is continued to keep dropping through the end of the year as developers struggle to reach their annual sales targets and salepeople try to preserve their individual bonuses.

The research report, which was cited in a story on Eastday, indicated that,

New homes, excluding government-funded affordable housing, were sold at an average 18,944 yuan (US$2,993) per square meter during the seven days, a weekly drop of 21.2 percent, according to research released yesterday by Shanghai Deovolente Realty Co.

The transaction volume soared 48.8 percent from a week earlier to 149,000 square meters.

“More than half, or 57 percent, of new homes sold across the city last week cost less than 15,000 yuan per square meter and the weekly average price had fallen to the lowest since early March,” said Lu Qilin, a researcher at Deovolente.

“The city’s five bestselling projects last week were all sold at a cheaper price than that,” Lu said.

A development in Qingpu District by Guangzhou R&F Properties became the most sought-after project last week with 195 apartments sold at 10,637 yuan per square meter, a discount of nearly 20 percent from its previous price, according to Deovolente data.

Despite these lower rates, however, transaction volume remained low as most buyers continued to wait for still further price reductions. According to Century 21, between December 1 and Sunday only 299,000 square meters of new apartments were sold in Shanghai, down 50.6 percent from the same period a year ago.