Sluggish sentiment in home sales not masked

A slight rebound in purchases of new homes in Shanghai could not mask a wait-and-see sentiment for a third straight week, market data showed yesterday.

The purchases of new homes, excluding government-subsidized affordable housing, rose 16.2 percent to 175,400 square meters during the seven days ended on Sunday, Shanghai Deovolente Realty Co said in a report.

"Despite the growth, the weekly transaction volume of new houses remained below the 200,000-square-meter threshold for three straight weeks, indicating a wait-and-see momentum among buyers, particularly those seeking medium to low-end apartments," said Lu Qilin, a researcher of Deovolente.

New homes were sold at an average of 29,518 yuan (US$4,720) per square meter last week, a week-on-week drop of 5.5 percent.

Huang Zhijian, chief analyst at Shanghai Uwin Real Estate Information Services Co, echoed the slack sentiment view.

"Slack sentiment started to dominate the local housing market since the beginning of this year, ending a strong rally in the last month of 2014," Huang said.

On the supply side, 241,600 square meters of new homes were released to the local market last week, a weekly surge of 272.6 percent, Deovolente said.