Shanghai Property Market Surges Following Eased Home-Buying Rules
Shanghai's real estate market is experiencing a significant boost following the city's decision to ease home-buying restrictions, mirroring a similar move in Beijing earlier. Both new and second-hand property markets have seen a marked increase in activity, driven by strong buyer demand and revised policies aimed at alleviating purchasing restrictions.
Relaxed Policies Spark Demand Surge
On August 26, Shanghai implemented new measures to stimulate the housing market, including removing restrictions on the number of homes residents can purchase in suburban areas beyond the Outer Ring Road. The policy applies to locals with household registration and non-locals who have paid income tax or contributed to social security for at least a year. In addition, the city enhanced borrowing support for potential buyers.
The impact was immediate. "The week after the new policies were implemented, the number of visits to our project increased 50 percent compared with the previous week", said a sales supervisor at a real estate project in Jiading New Town. The changes, they added, have "clearly released a new wave of market demand."
High Sales Volume Reflects Renewed Buyer Interest
The city's relaxed rules have led to remarkable sales activity across several developments. For instance, a large new housing project in Baoshan district released 160 new units the day after the policy changes, and all were sold out the same day. "The new policies will likely bring more than 20 percent additional customers to this project, supporting its sales", said Wang Liping, the project's marketing director.
In Qingpu district, a new project launched on August 30 achieved sales exceeding CNY400 million (USD56 million) on its first day, with most larger apartments selling out immediately. Many buyers were individuals previously unable to purchase additional properties due to earlier restrictions, which required the sale of an old property before acquiring a new one.
Meanwhile, the second-hand housing market has also rebounded. On August 30, more than 1,100 preowned homes were sold in Shanghai, surpassing the 1,000-unit mark for the first time in two months.
Quotes Reflect Market Optimism
According to the sales director of a Huafa Group project in Songjiang district, the new policies are motivating customers who had been hesitant or restricted from buying to move forward with purchases. "The new policies are prompting customers who had a wait-and-see attitude and those who were restricted from buying to place orders, while alleviating their financial pressure to some extent", they said.
Real estate developers noted that residents looking to upgrade their living situations comprise the majority of recent buyers. Without policy restrictions, these buyers now have greater ease in accessing loans, driving increased transaction volumes at many projects, some of which have sold out upon debut.
Broader Implications for Shanghai’s Housing Market
Cheng Yu, executive deputy general manager at the Shanghai corporate division of the China Index Academy, highlighted the broader impact of the new measures. "Shanghai's new real estate policies play a crucial role in alleviating the transaction pressure in the housing market outside the Outer Ring Road", Cheng stated. By reducing purchase costs and addressing previously suppressed demand, the policies may help ease the city's real estate inventory pressure and foster market stability.
Zhang Bo, research director at the 58 Anjuke Research Institute, predicted that these changes would position Shanghai as a leader in the recovery of China’s real estate industry. The new measures are also expected to drive a significant sales boost during the traditional peak sales season from September to October, as noted by multiple housing project executives.
With these latest policy adjustments, Shanghai's property market appears poised for sustained recovery, offering a model for other cities seeking to revitalize their own real estate sectors.