Shanghai taking steps to stop housing market from overheating
Developers required to ensure at least 70 per cent of units built in urban area are no bigger than 100 square metres
Shanghai officials have issued a new policy aimed at forcing developers to increase the supply of small and mid-sized units in an effort to prevent the city’s housing market from overheating, with analysts expecting even stricter policies to be introduced to rein in the market.
The city government said on Tuesday that developers would be required to ensure that at least 70 per cent of units built in Shanghai’s urban area were no bigger than 100 square metres, with the ratio rising to 80 per cent around subway stations and falling to 60 per cent in suburban areas.
Shanghai’s home market has shown signs of “panic buying”, with a new project selling out in one day.
Developer Shui On Land said on Monday it had sold all 352 residential units at the newly launched Rui Hong Xin Cheng Phase 6 in Shanghai’s Hong Kou district within a day, with the value of sales totalling 3.5 billion yuan, and average selling prices hitting 80,000 yuan per square metre or 10 million yuan per unit.
According to data from real estate consultancy Tospur, 597 units valued at over 10 million yuan were sold in Shanghai last year, compared with an average of 120 units such from 2010 to 2014.
It seems out of control, the current policy can not stop increasing market enthusiasm
“It’s so crazy,” said a woman who had just bought a new home at a development in Shanghai Yuqiao, a suburban area in the city’s Pudong district.