The average price of new homes rose to a record high in Shanghai last week as luxury houses continued to attract buyers.

New homes, excluding those designated for relocated residents under the city's urban redevelopment plans, were sold at 19,991 yuan (US$2,927) per square meter between August 10 and 16, an increase of 17 percent from a week earlier, according to a report released yesterday by the Shanghai Uwin Real Estate Information Services Co.

"Booming sales at two luxury developments over the past week helped establish the new record, which was the highest since home prices were tracked in the city," said Lu Qilin, a researcher at Uwin. "Buying sentiment remained strong among investors as more pick high-end properties as a hedge against inflation."

More than 200 units at Star River in Pudong New Area and Bund House in Huangpu District, both launched on August 8, were sold last week at an average price of 49,360 yuan and 49,974 yuan per square meter, respectively.

The two projects saw 2.896 billion yuan in combined sales during the seven-day period which accounted for 37 percent of the city's total by value, Uwin statistics showed.

The transaction volume of new homes continued to fall in the first half of this month while the average price further climbed, maintaining the trend since last month.

Between August 1 and 16, a total of 853,700 square meters of new homes were sold in the city, a drop from 1.03 million square meters sold in the same period a month earlier.

However, the volume of new houses with a price tag of more than 40,000 yuan per square meter rose to 77,800 square meters in the first 16 days of this month, compared with 44,100 square meters a month earlier.

(Shanghai Daily August 18, 2009)