The luxury home market in Shanghai, China’s commercial and financial hub, has displayed some signs of fatigue as owners of some flats had to roll out price cuts of more than 30% to woo buyers, reports the South China Morning Post. A correction, following nearly two years of growth, was a warning to wealthy local investors who believed that homes worth at least RMB 30 million ($4.2 million) would always be good buys.
“The luxury housing segment, particularly lived-in homes, should have run out of steam because some buyers are no longer convinced of their investment value,” said You Liangzhou, owner of Shanghai property agency Baonuo. “Wealthy investors mainly look at newly built units in the city’s prime locations while shunning those pre-owned homes.”
On the mainland, luxury homes are generally high-end flats and villas valued at no less than RMB 30 million each. Brokers said some expensive homes could not attract buyers even after owners reduced prices by more than 30%.