China's luxury real estate market is rapidly recovering.

In Shanghai, wealthy families are buying expensive homes at a record pace, while buyers in other major cities are also eyeing high-end properties as a less risky alternative to the stock market.

Last week, Singaporean company CapitaLand sold all 75 apartments at its luxury project in Shanghai within 45 minutes of its launch, earning 3.1 billion yuan ($492.4 million).

Prices of luxury real estate along the Huangpu River in Shanghai are rising again. Photo: AFP.

The project, located in the central Huangpu district, is priced at 168,000 yuan per square meter. It is almost five times oversubscribed. New homes in Shanghai sold for an average of 65,920 yuan per square meter in February, according to real estate information provider Fang.com.

During April, developers in Shanghai sold 24 billion yuan of luxury homes priced at 20 million yuan or more, up 156% from a year earlier, according to data provider China Real Estate Information Corp (CRIC).

“Shanghai has seen at least three batches of luxury homes sold out this year, which is enough to demonstrate the resilience of the city’s high-end property market and could be a sign that China’s property market is getting better,” said Yan Yuejin, director of Shanghai-based E-house China Research and Development Institute.

Mr. Yan also noted that Shanghai projects in high demand are all located in the center, adding that the recovery of the high-end real estate segment will spread to the mass market.

Yan's observations are similar to those of Bob Li, a businessman in Shanghai, who told the news agency that his family is looking to buy a luxury home in a prime location because they expect prices to rise due to limited supply.

“The rarity of luxury homes, especially those along the Huangpu River, makes them affordable despite their sky-high prices. They are unlikely to see prices fall given the interest around new homes that have recently come to market,” he said.

Mr. Li said he has entered four new home lotteries in the past month but has had no luck so far. The lottery is a mechanism used by developers to select buyers when a new project is oversubscribed.

Outside of Shanghai, the recovery of the luxury housing market is slow but steady in other first-tier cities.

In Beijing, transactions in the high-end segment rose 51.3% month-on-month to 9 billion yuan in April. However, the value was 18.8% lower than the same period last year.

In Shenzhen, China's tech hub, transactions rose 6.6% month-on-month in April to 1.4 billion. That was still down 33.3% from a year earlier.

“In the primary market, the increase in supply of high-end properties, coupled with the fact that certain projects are being offered at prices even lower than used luxury homes, is a huge boost to market sentiment,” CRIC analysts said in a March report.

The report also points to the growing influence of high net worth individuals across the country as another pillar supporting the stability and recovery of the luxury housing market.

The recovery in the luxury housing market comes as the government makes its most ambitious attempt yet to rescue the country's ailing property market.

National new home prices fell 0.6% month-on-month in April, marking the 11th straight month of declines. In the secondary market, home prices fell 0.9%, marking the 12th straight month of declines, according to official data.

“The measures announced this time are targeting both the supply and demand sides and will help accelerate the recovery of the property market,” said Shen Meng, director of Beijing-based investment firm Chanson & Co.

Le Na (According to SCMP)

Source: https://www.congluan.vn/thi-truong-bat-dong-san-cao-cap-tai-trung-quoc-hoi-sinh-than-toc-post296118.html