More mainland home seekers are deciding to keep renting instead of buying in anticipation of a further fall in prices, contributing to the continuing rise in rents across the nation.
'A unit release at a reasonable rent will get a tenant in two days,' said Lu Xiaoming, of Ming Ming Property Consultant in Shanghai.
With central government moves to curb demand and contain prices, property transactions have tumbled 50 per cent.
'More and more people are deferring buying as they expect prices will decline further. It will create more demand for rental properties,' he said.
Residential rents in Shanghai have risen as much as 15 per cent, or 400 yuan (HK$487) to 500 yuan, more per month this year.
Eight out of nine cities monitored by the China Real Estate Index reported a year-on-year rise in rents in August. Major cities such as Beijing rose 12.24 per cent last month from a year earlier, Guangzhou rose 11.28 per cent, Suzhou 13.17 per cent and Chongqing 13.91 per cent.
Doris Leung, who has been leasing since she moved to Shanghai in 2002, just signed a new lease for a 117-square-metre flat in Xuhui district for 5,700 yuan a month, nearly 30 per cent more than her previous lease in the same area. 'The unit size is more or less the same as before but the rent has increased a lot,' she said.