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Existing home prices in Shanghai holding up
2013-01-08
By Nie Xin

PRICES for existing homes in Shanghai remained solid in 2012 overall, though home buyers expected more for their cash, a new report revealed.

Figures from the Shanghai Second-hand Housing Index Office, tracking prices for existing apartments across the city, showed that the December existing housing index stood at 2,600.

This was up 0.19 percent on the same period last year and a marginal increase of 0.04 percent on November's figure.

After sliding in the first half of the year, prices of existing housing in Shanghai rebounded after June, ending the year up on 2012.

Xia Bin, director of the Institute of Finance Research at the Research Center of the Development of State Council of China, told China Times at the end of December that housing prices are unlikely to rise much in 2013.

"The economy of China has been seeing a balance of stable increase and structural adjustment. The direction of real estate development will not change. The trends will still be containment of speculative house purchases and the construction of affordable houses," said Xia.

"So people shouldn't have the unreal expectations that the housing prices are going to rebound."

Chinese people are familiar with predictions of this kind. From the series of housing purchase restriction policies to the property tax policy on the horizon, mechanisms for containing property prices have been a feature of recent times.

However, the slight rise in December's existing housing index figures showed that some rebound could be on the way, suggested some industry figures.

"This trend shows the weak effect of the control policy of Chinese government, and scary forecasts of rebound in Chinese real estate started to show up at the end of last year," said Nie Renjie, a senior real estate investor in Shanghai.

Sales volume of existing homes in Shanghai increased from 80,000 in the first six months of 2012 to 100,000 in the second half of the year.

Rises in both turnover and prices created a "warm winter" in real estate, industry figures said.

A few investors going back to the market in recent times had also helped put prices on an upward trend, said Nie.

The Shanghai Second-hand Housing Index Office also indicated that home buyers were becoming more choosy in their demands.

The report found that popular locations for buying included around Jing'an Temple in Jing'an District, Shanghai Stadium in Xuhui District, Fuxing Park in Huangpu District and Wujiaochang area in Yangpu District.

The report also found that properties around 10 years old are popular. Sales in this category were up 1 percent in December compared with the previous month, with prices up 3 percent.

Real estate investor Nie said the existing home market offers better value than buying new homes.

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