Shanghai's housing market cooled last week as sentiment among both home seekers and real estate developers weakened as government measures to tame rising prices began to take effect.
The area of new homes sold, excluding government-funded affordable housing, fell 6.8 percent from the previous week to 219,000 square meters, Shanghai Centaline Property Consultants Co said in a report released yesterday.
The city's outlying areas continued to be the most sought-after, with around 55,000 square meters of homes sold in Nanhui in the Pudong New Area during the seven-day period when 358 apartments were sold in two projects.
The average cost of new homes plunged 9.1 percent from the previous week to 40,563 yuan ($5,990) per square meter, the lowest weekly data since August, according to Centaline research.
Notably, not a single apartment or house was launched in the local market last week -- a rare occurrence for October which is considered a high season for property transactions.
"A wait-and-see sentiment started to prevail in the city's housing market as further tightening measures by the government to rein in soaring home prices and curb property bubbles are changing the mind of some prospective buyers," said Lu Wenxi, senior manager of research at Centaline.
"Transaction volume will fall further as home purchase restrictions as well as stricter mortgage policies will be both implemented to dampen speculative demand," Lu said.
