(Yicai) Oct. 13 -- Shanghai authorities have raised CNY19.7 billion (USD2.7 billion) from auctioning the land-use rights for seven plots in the city at an average premium of about 6.7 percent.

A residential plot in the downtown Changning district drew the most interest at yesterday’s auction, attracting bids from eight property developers. It went for a 10 percent premium. A plot in central Jingan district sold for CNY81,200 (USD11,111) per square meter, the top end of the floor price, representing a 9.7 percent premium.

Four plots sold at the ceiling price and two at the upset price. No private developers took part in the bidding, and there were fewer participants overall than in previous auctions.

Plots are fetching more after new bidding rules were brought in, while stricter rules on the quality of new homes built will squeeze profit margins at developers, according to Chen Julan, a senior analyst at the Shanghai office of China Index Academy, a provider of real estate data and analysis. But financially robust state-owned builders will have an edge at land auctions, Chen added.

While land in downtown Shanghai was sought after, three parcels in Jinshan and Qingpu districts in the city's outskirts were sold at the floor price or a low premium, indicating that developers are still wary about such areas or difficult-to-develop land. It also showed that the attractiveness of different plots in the market still varies.

The sale of land-use rights is one of the most important sources of revenue for local governments in China. They raised CNY6.7 trillion (USD921 billion) in total last year from such sales, down 23 percent the year before.

Editors: Tang Shihua, Martin Kadiev