Shanghai Luxury House Market

Stephen Chung

Managing Director

Zeppelin Real Estate Analysis Limited

December 2004

The following was abstracted-translated from a special report titled “The Shanghai Luxury House Market” in the September 2004 issue of CREIS (China Real Estate Index System), a Chinese monthly real estate report on China markets, published by Soufun (www.soufun.com), a real estate data and research group in China. This summary is meant only for convenient reference and readers are advised to refer to the actual report for details and comprehensiveness.  

By “luxury house market” we refer to the residential sector that largely contains the pricier homes which are mostly detached, semi-detached, town or row houses located in the city or neighboring suburbs of Shanghai. Since its development in the early 1990s, this luxury residential sector is now becoming more sophisticated and matured: 

A)     Stock Built Since 2001 = approximately 14,000,000 m2 of floor area in close to 48,000 units have been built based on tracked projects. The rate of building has been on the increase since.

B)     Plot Ratio (similar to Floor Area Ratio in the USA) = averages around 0.34 based on 2003 projects.

C)    House Form Distribution = Detached 49%, Semi-detached / Duplexes 36%, Low-rise 12%, and Townhouse 3% based on 2003 supply.

D)    House (Floor Area) Size Distribution = Less than 200 m2 17%, 200-250 m2 20%, 250-300 m2 20%, 300-400m2 25%, 400-500 m2 10%, and larger than 500m2 8% based on 2003 supply. The average size is approximately 271 m2 or 2,923 ft2.

E)     Number of Rooms = the average is 5 rooms though the most expensive houses would offer 7 in all. The living room generally ranges between 31-50 m2 while the master bedroom generally ranges from 21-30 m2.

F)     Number of Stories = 2-storey is typical and there are 3 storey ones as well. There have also been ones that are 3 1/2 storey-high yet are these are becoming less popular now.

G)    Typical Buyer Profile = aged between 35 to 45, and many are professionals and business executives.  

 Typical Price Range = 73% of all luxury houses are priced and sold between the 1,500,000 Yuan to 5,000,000 Yuan range [8.30 Yuan = US$1.00] with the price per m2 floor area ranging mostly between 5,000 Yuan / m2 to 15,000 Yuan / m2.

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