China property: revival in Shanghai, Beijing and Shenzhen luxury home prices bodes well for mass market
- Rich investors are snapping up luxury homes in Shanghai at a fast clip, with the segment picking up pace in other top tier cities as well
- Developers in Shanghai sold 24 billion yuan (US$3.3 billion) worth of luxury homes, a 156 per cent jump from a year earlier, according to an industry data provider
Recovery in China’s luxury home market is gaining pace even as the rest of the residential segment is struggling with lacklustre demand. However, the government’s recent measures could reverse the overall property market slump, analysts say.
In Shanghai, high-net-worth families are snapping up expensive houses at record speed, while buyers in other big cities are also eyeing premium properties as a lower-risk alternative to the stock market.
On Thursday, Singapore’s CapitaLand sold all 75 flats at its Shanghai luxury project within 45 minutes of launch, pulling in 3.1 billion yuan (US$492.4 million). The price of the project, located in the central Huangpu district, at 168,000 yuan per square metre was not a deterrent, as it was nearly five times oversubscribed. New homes in Shanghai were sold at an average price of 65,920 yuan per square metre in February, according to real estate information provider Fang.com.
Throughout April, developers in Shanghai sold 24 billion yuan worth of luxury homes priced at 20 million yuan and above, a 156 per cent jump from a year earlier, according to figures from data provider China Real Estate Information Corp (CRIC).
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“Shanghai has witnessed at least three instances of luxury homes being sold out so far this year,” said Yan Yuejin, director of Shanghai-based E-house China Research and Development Institute. “This sufficiently demonstrates the resilience of the city’s premium property market, and could be a sign that China’s property market is taking a turn for the better.
