Shanghai’s property market is likely to see more transactions involving office buildings, shopping malls and rental homes this year because landlords are willing to reduce prices while high-net-worth individuals pursue safe returns amid deflationary pressure.
Foreign institutions are also showing increasing interest in hunting bargains on the local property market despite economic turbulence, according to property consultancy JLL.
“As landlords become more accepting of providing price concessions to cash out, transaction prices are becoming more reasonable,” said Sun Ling, head of capital markets for JLL East China. “Following a period of market volatility and price adjustments, more projects in Shanghai are expected to be put on the market and be transacted in 2025.”
02:15
China sees slowest economic growth in over a year with 4.6% GDP in third quarter
China sees slowest economic growth in over a year with 4.6% GDP in third quarter
The number of deals was set to jump further in 2025 following a 12 per cent year-on-year increase last year to 103, she added. Transaction value in 2024 slumped 38 per cent to 57.4 billion yuan (US$7.8 billion) from a year earlier, JLL data showed. The proportion of foreign investment climbed to 12 per cent from 6 per cent.
Most deals signed last year were valued at less than 1 billion yuan each, and the small-scale projects attracted some super-rich individuals, Sun said.
“Due to weak economic conditions, it remains a buyers’ market since they have the bargaining power in negotiations,” said Yin Ran, an investor in Shanghai. “Apparently, more landlords are anticipating further price declines in their properties and they may decide to exit now.”
Shanghai, mainland China’s commercial and financial hub, reported 4.7 per cent growth in economic output in the first three quarters of 2024, below the 5 per cent target it set at the beginning of last year.
Source link
