New home sales in city tumble

NEW home sales plunged in Shanghai in the first 13 days of this month due to the combined effect of the government's successive measures to curb speculation in the property market and the week-long Spring Festival holiday.
Sales of 38,000 square meters of new homes, excluding those built under the city's affordable housing program, were sold during the period, according to statistics released yesterday by Shanghai Uwin Real Estate Information Services Co.
In January, about 1 million square meters of new homes were sold across the city.
"The local new property market almost has stagnated since the beginning of this month amid extremely low buying sentiment, and the situation will definitely last for some time," said Huang Zhijian, chief analyst of Uwin. "Hopefully, that will help increase pressure on developers to cut prices by as late as the end of the first half (of the year)."
Last week, new homes totaling 32,000 square meters were sold across the city at an average 20,129 yuan (US$3,050) per square meter. The average price was 8.6 percent lower than a week earlier because only eight houses priced at more than 40,000 yuan per square meter were sold during the period, Uwin's research showed.
Sales of high-end residential properties, in particular, have been significantly reduced recently, mainly due to the latest government policy to ban purchases of third homes, analysts said.
Shanghai announced on February 1 that local families who already own two or more houses and non-local families who have one home already in the city will be banned from buying any more homes here, the toughest measure ever launched by the government.
It's the same scenario in the city's existing home market.
"It might take about three months for the local market to step out of the current situation as a wait-and-see sentiment is prevalent," said Eric Luo, a researcher of Century 21 China Real Estate, which operates about 300 branches in Shanghai.
Source:Shanghai Daily