(Yicai) Dec. 5 -- A rush on affordable homes is helping to revive the pre-owned housing markets in large Chinese cities such as Beijing, Shanghai, and Hangzhou, defying the customary year-end slowdown.

More than 22,940 second-hand homes were sold in Shanghai last month, up 24 percent from October and the most since May, figures from the Shanghai Real Estate Trading Center showed. Sixty percent were priced under CNY3 million (USD424,380), according to local data provided by Lianjia, the country’s largest real estate agency.

“Many homebuyers who plan to live in the property believe prices have fallen to a relatively low level, with acceptable risk, so they’re choosing to step into the market,” said Li Gen, head of the Shanghai Lianjia Research Institute, the think tank’s local unit. 

“At the same time, the rent-to-price ratio for affordable homes has improved significantly, making this a good entry point for investors as well,” Li added.

In Beijing, sales jumped 20 percent to 14,446 in November, per the local housing commission’s data. Resale apartment prices fell 1.4 percent, according to Fang.Com, a property listings platform. Prices for about 60 percent of those within the Fifth Ring Road -- the expressway encircling the capital -- dropped by an average of 5 percent to 10 percent, with some down as much as 15 percent.

It was a similar story in Guangzhou. Pre-owned home sales exceeded 9,190 for a total area of 910,000 square meters, an increase of 23 percent on October, according to the Guangzhou Association of Real Estate Agents. About 5,495 units sold in Shenzhen, up 4.2 percent, data from leading property agency Beike showed.

The markets also picked up in some second-tier cities. Hangzhou’s rebounded from a seven-month of decline, with 6,561 second-hand home selling in November, an almost 11 percent gain on October, according to Beike’s figures.

Many of Hangzhou’s previously overlooked, entry-level neighborhoods broke into November’s top 20 by transaction volume, per figures from the Hangzhou Beike Research Institute, the think tank’s local arm, and Woai Wojia Real Estate Brokerage.

Twelve of the 20 were entry-level areas where homes sell from just CNY10,000 (USD1,415) per square meter, which suggests that prices in suburban and outer-suburban areas have now fallen to levels many buyers find acceptable, said Jian Shangguan, who heads the Hangzhou Beike Research Institute. 

The resale market in other second-tier cities is also picking up, with month-on-month sales in Suzhou up 23 percent to 4,500, and those in Xi’an up 5 percent to 7,237, according to local realtors.

Editor: Futura Costaglione