Shanghai luxury homes get smaller while prices get ever greater
Shanghai luxury homes get smaller while prices get ever greater
Is Shanghai the new Hong Kong?
What do you do when prevailing market prices of homes are skyrocketing at double-digit rates?
You build them smaller, of course.
Saddled with one of the hottest real estate markets in the world, property developers in Shanghai have been forced to downsize their offerings in order to keep selling prices down, China Daily reported.
One developer, the state-run China Overseas Land and Investment Ltd, has seen its luxury products shrink to 200-210 or 130-140 square metres in the city. Properties in the same segment two years ago had floor areas ranging between 250 and 400 square metres, in comparison.
More: Hong Kong buyers seek smaller units as home prices reach new heights
The average price of a 90-square-metre unit in Shanghai is 25 times the average household income in 2016, China Daily pointed out.
It’s a story familiar to many residents in Hong Kong, a high-density city where small flats are known to fetch stratospheric prices. “Shanghai’s luxury real estate market today is replicating the story of Hong Kong,” the Shanghai office of Hong Kong-listed China Overseas Land and Investment Ltd reported.
“Buyers are accepting the idea that luxury homes could go with a floor space of 100 square meters, a frustrating reality that Hong Kong people have long lived with.”
Read next: What will Shanghai look like in 2040?
Source: Property Report