Home sales volume contracts amid slower new project launches

• The slowdown in project launches caused a 34.5% q-o-q decline in Shanghai’s primary home sales volume, totalling 1.49 million sqm in Q1 2025. Pre-sale performances varied greatly among new projects, with high-quality ones in prime locations maintaining solid demand.
• Buying demand for high-end projects remained robust in the quarter. However, a decrease in new high-end project launches led to a 46.3% q-o-q fall in high-end sales volume in Q1 2025, with 1,040 units registered as sold.

Four high-end projects launched for sale in Q1 2025

• New home supply declined sharply in the quarter due to the Chinese New Year holiday in January and developers’ slowdown in project launches in February. The quarter’s new home supply totalled 0.78 million sqm, marking a 62.3% q-o-q decline.
• The pace of new high-end project launches slowed in Q1, with only four high-end projects totalling 635 units launched for sale, a 65.9% q-o-q decline. The average prices of the four new high-end projects ranged between RMB 143,000 per sqm and RMB 189,000 per sqm.

High-end secondary price decline narrows further

• Shanghai’s average high-end primary price increased by 0.5% q-o-q to RMB 144,600 per sqm in Q1 2025. Meanwhile, continued recovery in high-end secondary sales led to a narrower decline in the average secondary price, which fell by 1.6% q-o-q to RMB 135,500 per sqm.
• Despite a slight rebound in high-end leasing, the ample supply of high-end units for lease continued to put downward pressure on rents. As a result, average high-end rent declined by 2.6% q-o-q to RMB 159.7 per sqm per month in Q1 2025.

Outlook: Looser credit conditions and relaxed housing policies to support home sales recovery

• Looser credit conditions, coupled with Shanghai’s relaxed housing policies, are expected to sustain the ongoing recovery of homebuying sentiment in both the primary and secondary home sales markets.
• High-end primary prices are expected to rise further, while high-end secondary prices are likely to experience slower declines as demand for high-end secondary projects continues to recover.