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Local housing oversupply now at record level
By Cao Qian |
September 16, 2011, Friday
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Print Edition
Print Edition
SLUGGISH sentiment among buyers over the past seven months has taken Shanghai's housing inventory to a record high.
New homes available for sale, excluding affordable housing, yesterday stood at 8.16 million square meters, according to data on the city's official real estate website, www.fangdi.com.cn.
Luo Yadong, vice general manager of real estate agency Shanghai Deovolente Realty, said: "New home inventory has been hovering around 8.2 million square meters over the past few days, and that figure has certainly gone beyond a reasonable level.
"At the current pace of sales, it could take more than 15 months to unload the entire stock - far more than the six months recognized as healthy in terms of inventory digestion speed."
Last month, a total of 520,000 square meters of new homes were sold in Shanghai.
In the first 11 days of this month, about 190,000 square meters were sold across the city, according to Deovolente.
Analysts said price cuts should be the only effective way to reduce the backlog.
Song Huiyong, research director at Shanghai Centaline Property Consultants, said: "Developers will release more projects in September and October - the traditional high season for home purchase.
"However, sales will not be effectively boosted if developers do not offer some notable discounts to buyers, say at least 10 percent."
More than 90 residential projects are scheduled to release units for sale this month and next, according to real estate website Soufun.com.
Government measures to rein in the runaway property prices have resulted in fewer sales of new and previously-owned homes in major Chinese cities, although prices have remained firm.
New homes available for sale, excluding affordable housing, yesterday stood at 8.16 million square meters, according to data on the city's official real estate website, www.fangdi.com.cn.
Luo Yadong, vice general manager of real estate agency Shanghai Deovolente Realty, said: "New home inventory has been hovering around 8.2 million square meters over the past few days, and that figure has certainly gone beyond a reasonable level.
"At the current pace of sales, it could take more than 15 months to unload the entire stock - far more than the six months recognized as healthy in terms of inventory digestion speed."
Last month, a total of 520,000 square meters of new homes were sold in Shanghai.
In the first 11 days of this month, about 190,000 square meters were sold across the city, according to Deovolente.
Analysts said price cuts should be the only effective way to reduce the backlog.
Song Huiyong, research director at Shanghai Centaline Property Consultants, said: "Developers will release more projects in September and October - the traditional high season for home purchase.
"However, sales will not be effectively boosted if developers do not offer some notable discounts to buyers, say at least 10 percent."
More than 90 residential projects are scheduled to release units for sale this month and next, according to real estate website Soufun.com.
Government measures to rein in the runaway property prices have resulted in fewer sales of new and previously-owned homes in major Chinese cities, although prices have remained firm.
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