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Used home prices gliding upwards

THE average price of second-hand homes in the city rose slightly last month as more buyers sought accommodation upgradings.

Shanghai Centaline Property Consultants Ltd, which operates the city's largest brokerage chain, said today the price of used homes climbed 3.1 percent to 16,144 yuan (US$2,363) per square meter on average in May at its 150 plus branches.

In particular, homes priced between 800,000 yuan and 1.2 million yuan per unit, and those tagged between 1.2 million yuan and 2 million yuan per unit, attracted the most buyers, accounting for 28 percent and 27 percent, respectively, of the total deals secured during the period, according to the company's research.

"Demand for low-end apartments, mainly for privatized public houses, started to taper off over the past month while more people began to look for newer and larger apartments," said Ma Ji, head of research at Shanghai Centaline."Moreover, an inadequate supply of second-hand homes contributed to the price increase."

Centaline statistics showed that listings of used apartments in Zhabei, Baoshan, Putuo, Changning, Jing'an and Pudong all fell between 20 to 30 percent in May, while home prices, consequently, climbed between 10 to 20 percent.

The latest research by Century 21 China Real Estate, the city's second-largest brokerage chain, showed the same trend.

Deals of used apartments priced below 800,000 yuan per unit fell to 21 percent of the total transactions sealed at Century 21, a month-on-month decrease of 5 percentage points. However, at the same time, homes tagged between 1.2 million yuan and 2 million yuan per unit and between 2 million yuan and 3 million yuan per unit both became more popular among buyers last month, snapping a market share of 31 percent and 15 percent, respectively.

"We expect to see more deals, particularly with price tags of between 1.2 million yuan and 3 million yuan per unit, to be completed during the rest of the year," said Huang Hetao, a researcher at Century 21.

"And the local market should keep stable with people seeking upgradings remaining a major buying force."

However, inadequate supply, coupled with rising temperatures, might have some negative impact on transactions in the coming months, industry analysts said.


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