In what is obviously a sign of a healthy housing market in which prices are driven by demand, and not a dangerous bubble inflating beyond all rationality, a property in Pudong has sold for a record-breaking price of 220,000 RMB ($35,000) per square metre.
The recording-setting deal is allegedly a unit of 35 square meters on the 10th floor with its total price at 84 million yuan (US$13 million). The price of the property nearly doubles that of other nearby properties.
An analyst employed by a Shanghai realtor was shockingly bullish about the sale, saying it “shows the returning passion of China’s top customers with a bounce after the bottoming out of the country’s economy”. If reports are accurate the property will rank among the 10 most expensive properties in the world ever sold ever.
Patrick Chovanec, Business Professor at Tsinghua University (previously), points out that average price per square metre* in New York’s prestigious Upper East Side (pre-Sandy) is approximately $14,316, meaning this office in Pudong is worth more than double the most expensive real-estate in one of the world’s most expensive cities. The most expensive property ever sold in
New York New York’s Nolita neighbourhood went for approximately $34,444 per square metre.
This price disparity is even more insane when one considers the difference in average purchasing power between New Yorkers and Shanghai residents. According to the Shanghai Statistics Bureau the average salary for city residents in 2011 was approximately $8,357, compared to $56,400 in New York.
Meanwhile, normal house prices in Shanghai also had a boost according to state media, rising 0.33% to 15,625 RMB ($2,502) per square metre.
TL;DR: In a city with less than 1/6th the average income of New York, this one office in Pudong cost 2.5x more than an average Upper East Side residence.
Thank you to Patrick Chovanec for his kind help with figures and statistics for this article.
*Price per square foot = $1,330, 1 square metre = 10.7639104 square feet
Join Shanghaiist for the Hairy Crab & Sex Museum Tour on Nov 3-4! Click below image to find out more: