Slack mood dents new home purchases

Sales of new homes in Shanghai fell below the 200,000 square-meter level last week and new houses released also dropped amid a sluggish sentiment among home buyers and developers.

The purchases of new homes, excluding government-subsidized affordable housing, fell 28.5 percent week on week to 198,000 square meters during the seven-day period ended on Sunday, Shanghai Deovolente Realty Co said in a report released yesterday.

"For the first time in nine weeks, the volume of new home sales fell below the 200,000 square-meter threshold, evidence of momentum easing notably among buyers," said Lu Qilin, a Deovolente researcher.

"We expect the lackluster sentiment to prevail in the market during rest of this month as real estate developers also face no pressure to meet their annual targets following robust sales in the first 11 months."

Meanwhile, about 133,000 square meters of new houses were released citywide last week, a weekly plunge of 55.5 percent, according to the report.

The new homes sold last week cost an average 25,523 yuan (US$4,184) per square meter, down 1.5 percent from the previous week.

As of Sunday, more than 12 million square meters of new homes were sold in Shanghai, a rise of over 43 percent from the same period a year earlier, according to data released yesterday by Century 21 China Real Estate.

Housing projects in outlying areas targeting budget-tight first-time buyers again dominated last week's list of top 10 best-selling projects.