Shanghai's residential market driven by first-time buyers

By Cheryl Tay:

The high sales momentum in Shanghai's residential market in Q2 and Q3 2012 continued in Q4, with first-time home buyers as the main market drivers, according to Jones Lang LaSalle (JLL). Demand from first-time buyers also helped facilitate a sales recovery in Pudong.

Sales of commodity housing in the primary market climbed by 25 percent quarter-on-quarter to 3.1 million sq m in Q4. This brings sales for the entire year to 9.5 million sq m or an increase of 30 percent from 2011.

A report by World Property Channel noted that the sales momentum could also be partially attributed to the increased sales in mature estates, which offset the decline seen in emerging areas.

Notably, the luxury property segment saw 452 units snapped up in Q4 2012, up from Q3's 433 units. With only a number of property developers offering discounts, primary sales of luxury apartments held firm at RMB67,600 psm (S$13,335.13 psm).

Meanwhile, demand in the serviced apartment market has been restricted by tighter corporate budgets for housing and weakened by high-end non-serviced apartments that offer lower rents.

Joe Zhou, Head of Research for Jones Lang LaSalle Shanghai, expect the sales momentum in the mass market to remain stable in 2013 "as the government continues to improve affordability for first-time buyers and even upgraders to some extent." Meanwhile, SC Global did not comment on other qualifying certificate charges that it may have to pay. Cheryl Tay, Editor of CommericalGuru, wrote this story. To contact her about this or other stories, email cheryltay@allproperty.com.sg Related Stories: S'pore buyers expected to snap up KL penthouses Bumper month for UK property exhibitions

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