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Commodity property supplies in Shanghai were 1.74 million square meters in the month, slightly less than the 1.81 million square meters in June. Commodity house supplies rose slightly from 1.29 million square meters in June to 1.29 million square meters.
Analysts said the major reason for the increase in supplies is that some large real estate developers sold new houses at discount prices and cut the prices of already-built houses. But the price reduction strengthened the negative outlook for the domestic real estate market and propelled more potential house buyers to hold money tightly, expecting for lower prices.
According to the research statistics, July witnessed commodity property sales in Shanghai dropped 28.77 percent to 1.01 million square meters, versus 1.43 million square meters in June. Of these, commodity house sales were 718,100 square meters, down 31.12 percent than 1.04 million square meters in June and down 66.91 percent compared to 2.17 million square meters last July.
Following real estate developers' price reductions, local housing prices fell to CNY 12,824 per square meter from CNY 16,988.
As some demands for houses have been met in recent months and larger real estate developers' price reduction attracted many house buyers from small ones, Shanghai's real estate market would become even gloomier in August, forecast market analysts. In such an environment, more real estate developers would have to cut prices.
This situation may turn better in September and October, when the price-performance ratio of some houses would be seen and another round of purchasing power would be accumulated. House sales then will pick up to a certain extent.
Due to the sharp decline in construction of new houses last year, new house supplies are unlikely to rebound that much.
Shanghai's commodity house supplies totaled 6.18 million square meters in the first six months, lower than the 6.99 million square meters a year ago.
First-half house sales were 5.25 million square meters, sliding nearly one half than 10.43 million square meters in the same period of 2007. House sales amount was CNY 73.9 billion, falling from CNY 103.7 billion a year ago.
(USD 1 = CNY 6.83)
From www.cnstock.com, Page 1, Friday, August 01, 2008 info@SinoCast.com
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