Shanghai land prices out of sight

Shanghai's limited land supply for residential development and the current undersupply of housing stock have fuelled developers' expectations on further rise in housing prices. This has pushed up the prices of land auctioned recently, said Albert Lau, CEO of Savills China.

High land prices in Shanghai are a natural result of the market's development cycle. Developers who have been selling their existing properties need to supplement their land reserves for future development.

Additionally, they have secured enough liquidity from current sales so they are able to afford the high prices, said Lau in an interview with China Daily.