Shanghai's property rental prices surge

The rental prices for low, medium and high-end apartments in Shanghai have all surged, according to a report recently released by the Shanghai Property Rental Index Office (SHRIO).
The property rental index in Shanghai stood at 1,276 in February 2011, 15 points or more than 1 percent higher than a month earlier. The growth rate is 1 percentage point higher than that of January.
According to the report, the property rental market became brisk much earlier after the Spring Festival holidays this year than in previous years, along with rounds of inflation-driven rental price increases. The sharp increase in prices of various types of consumer goods have pushed up water, power, property decoration and other costs that are directly associated with accommodation, so apartment owners are transferring various types of increased living and apartment maintenance costs to tenants through rent.
In February, the rental prices in the high-end market experienced a month-on-month increase of 0.88 percent, the growth rate of which was 0.86 percentage points higher than a month earlier. The rent in the low-end market experienced a month-on-month increase of 1.59 percent, the growth rate of which was 1.43 percentage points higher than a month earlier.
SHRIO believes that with more effect of property regulatory policies, the market demand and supply has reached a long-standing stalemate, so an increasing number of people are taking a wait-and-see approach, causing the rental market to become increasingly brisk.
The surge in rental prices can be regarded to some extent as compensation for property prices, which are expected to be hit hard by the tightening polices. It is foreseeable that rental price increases will be a long-term process that is affected by the selling prices.
By Li Jia, People's Daily Online
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