Purchases of new homes continued to rebound in Shanghai last week as sufficient supply coupled with a red-hot land market jointly boosted sentiment among buyers.

The area of new residential properties sold, excluding government-subsidized affordable housing, jumped 31.9 percent from a week earlier to 241,000 square meters during the seven-day period ended Sunday, staying above the 200,000-square-meter weekly threshold for the first time in three weeks, Shanghai Centaline Property Consultants Ltd said in report released today.

"On one hand, the abundant supply of new homes over the past few weeks helped fuel buyers' momentum while on the other hand, the recent land buying frenzy also served as a strong stimulus," said Lu Wenxi, senior research manager at Shanghai Centaline. "And the strength is supposed to extend through the end of the month which usually registers larger volume of transaction."

Average cost of these new homes fell 4.8 percent week over week to 34,493 yuan (US$5,261) per square meter, mainly due to a structural shift, Centaline data showed.

Among the 10 best-selling projects, four of them are located not far from the latest batch of land plots sold in the city which garnered great public attention due to the high prices developers are willing to pay for.

Two projects in Nanqiao, Fengxian District, for instance, each sold 165 units and 61 units last week, ranking No.1 and No.4 in the top 10 list for notably higher prices compared to just one month earlier, according to data released today by Shanghai Homelink Real Estate Agency Co.

On May 11, a developer from Fujian Province, after beating more than 20 rivals, acquired a residential parcel in Nanqiao for an average gross floor area price of 22,625 yuan per square meter, up 126 percent from its asking price.

On the supply side, 206,000 square meters of new houses were released to the local market, a week-over-week retreat of 22.4 percent, according to Centaline data.

(Source: ShanghaiDaily  Author: Cherry Cao)