Luxury Market Defies Trends in China Property Sector
The Resurgence of China's Luxury Property Market
China's premium property market is witnessing an impressive recovery, highlighted by two significant projects in Shanghai that sold out shortly after their launch. A total of 110 flats at One Sino Park developed by Sunac China Holdings sold out within two hours, generating 5.7 billion yuan (US$798 million). Situated in the Huangpu district, the project had a striking price of 171,000 yuan per square metre (15,886 yuan per square foot) and was nearly doubled subscribed ahead of its launch.
Luxury Properties Leading Sales
Moreover, in the Putuo district, Yuexiu Property’s Suhe Grand Mansion also attracted considerable interest, selling all 124 flats it offered, even with a price tag of 103,570 yuan per square metre. Data from Fang.com indicated the average price for new homes in Shanghai dropped to 64,466 yuan per square metre in July.
Continuous Growth in Luxury Home Sales
Luxury projects are seeing a pattern of significant performance this year despite the overall downturn in China’s property sector. In the first half of the year, buyers acquired 1,544 homes priced above 30 million yuan in Shanghai, a peak not reached in a decade, according to CRIC data.
- July recorded the 14th month of declining new home prices.
- Top 100 developers noted a staggering 40% drop in home sales.
- Twenty of twenty-three premium residential projects sold over 70% of their inventory at launch.
The surge in luxury purchases isn't restricted to Shanghai, with cities like Beijing and Shenzhen also reporting rises. A reported 500 luxury homes exchanging hands last July indicates a 28% year-on-year increase.
Market Insights
The persistent strength of the premium residential segment demonstrates its allure amidst a challenging landscape, with transactions elevating for seven consecutive months this year. Yan Yuejin of E-house emphasized that the luxury market's rebound signals a recovery in its current cycle despite vast differences compared to the mass market.
Supply increases and competitive pricing from developers contribute to an enhanced market sentiment, fostering a healthier balance sheet for developers while keeping transactions active. Sunac anticipates launching further units at One Sino Park given its substantial success.This article was prepared using information from open sources in accordance with the principles of Ethical Policy. The editorial team is not responsible for absolute accuracy, as it relies on data from the sources referenced.