Discounts boost home sales
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New home sales in Shanghai rebounded above the 100,000-square-meter level last week for the first time in almost two months as developers offered discounts.
Sales of new homes, excluding those designated for relocated residents under urban redevelopment plans, soared 65 percent to 107,000 square meters during the seven-day period ending June 27, reversing a loss for seven consecutive weeks during which their sales hovered between 60,000 square meters and 95,000 square meters, according to latest research released yesterday by Shanghai Uwin Real Estate Information Services Co.
The average price also climbed 6 percent from a week earlier to 19,156 yuan (US$2,825) per square meter, below the 20,000 yuan per square meter bar for the third straight week as the city's top 10 best sellers of the week by area were all located beyond the Outer Ring Road.
"Real estate developers started to offer discounts to trigger home sales and that helped the latest rebound in transaction volume," said Lu Qilin, a researcher with Uwin.
"We've noticed quite significant discounts, around or above 20 percent, in a couple of projects mainly in non-central parts of the city such as the districts of Songjiang and Jiading," Lu said.
A residential project in Songjiang New Town, developed by Greenland Group, managed to sell 125 units by Sunday after it began to offer a 20 percent discount on June 8. By contrast only 10 units were sold during May when the developer offered only an 8 percent discount, according to Uwin's research.
On the supply side, more than 190,000 square meters of new houses came into the market during the past seven days, up 48 percent from a week earlier.
But the stock was insufficient compared to the average weekly supply of 242,000 square meters seen during the past 12 months, according to the research.
