The number of used apartments sold in Shanghai fell significantly for the second month in July, with the local second-hand housing index climbing by its slowest pace since the beginning of the year.

The index, compiled by Website www.ehomeday.com, inched up 0.38 percent to 2,396 last month.

It was the smallest increase so far this year. From January, it had increased 1.3 percent, 1.1 percent, 1.96 percent, 1.03 percent, 0.98 percent and 1.05 percent each month.

"A downward trend has become rather clear now as the transaction volume of second-hand apartments dropped by about 20 percent last month, following a 25-percent decline in June," Chi Shengyu, an analyst with the index compiler said.

"In terms of prices, about one third of areas monitored by our Website, as compared to one fifth in June, suffered decreases with an average retreat of 1.42 percent."

Across the city, second-hand home prices along Nanjing Road E. dropped the most - 2.74 percent in July - followed by Penglai Road in Huangpu District, Wuning Road in Putuo District and Sanlin area in Pudong New Area which all plunged by more than 2 percent from a month earlier.

Bucking the trend, the northern Bund area in Yangpu District led all gainers with a monthly increase of 2.39 percent. The downward pressure, in terms of volume and prices, will probably continue in August, the index compiler predicted.

Meanwhile, the local rental index, also released by the Website, edged up 0.8 percent, or 10 points, to 1,227 last month.

The average monthly rent for high-end apartments, usually asking for more than 6,000 yuan (US$880) for a two-bedroom unit, rose 0.3 percent, with Gubei area, Xinhua Road and Nanjing Road W. leading gainers.

However, mid-class properties, as well as privatized public apartments, both secured quite strong increases in rentals last month as July is the traditional peak season for mid-to-low-class properties.

In particular, apartments asking for 2,000 yuan to 6,000 yuan a month for a two-bedroom unit jumped 1.5 percent in July, with districts of Hongkou and Yangpu recording notable increases.

Meanwhile, the average rental for the city's privatized public apartments increased 1.4 percent during the period, with Luwan and Zhabei districts gaining the most.

(Shanghai Daily August 12, 2008)