SHANGHAI - Despite strong words from the government on the need to cool the over-heated property markets in various mainland cities, Shanghai is still pulling in investment funds from overseas, particularly Hong Kong.

Property agents in Shanghai said that they are stepping up their efforts to attract Hong Kong investment at a time when the Hong Kong property market is seen to have reached a peak with little room for further price hikes. "We are seeing many Hong Kong investors who made their millions in the local market frenzy in the past year now looking at the greener pastures in Shanghai," said Ma Ji, senior manager of the Shanghai branch of Hong Kong real-estate agent Centaline.

Some prospective Hong Kong buyers of Shanghai properties are motivated by the desire to own a better home away from home. In Hong Kong, most people can only afford to buy apartments that are no bigger than 100 square meters in floor area. In Shanghai, the average per-square-meter price is still significantly lower than Hong Kong, despite the recent hikes.

"It's like Shanghai people buying properties in the neighboring second-tier cities, such as Wuxi or Suzhou," Ma said. It is estimated that Hong Kong buyers accounted for more than 10 percent of all the 180,000 new apartments sold in Shanghai last year. What's more, buyers from Hong Kong are said to have bought more than 12 percent of the apartments sold at above 5 million yuan in the secondary property market in Shanghai in 2009.

To woo prospective Hong Kong buyers, Hanyu Property Agent, partly owned by a Hong Kong company, is planning to introduce what it describes as a "Straight Express Program" designed to take the chore of cross-city real-estate transactions and financing off the shoulders of the buyers. The program is designed to facilitate the acquisition of Hong Kong properties by mainland, mainly Shanghai, investors.

Hanyu has entered an advertising pact with Hong Kong's Sing Tao Daily newspaper, to promote Shanghai properties to prospective local buyers.

The contents of the supplement will not be limited just to property, said a Hanyu manager responsible for the project. "We want to introduce Shanghai as a whole, hoping to let more Hong Kong people know about this city," Shao Minghao, head of Hanyu's research department, said in Shanghai.

Each week, a special topic relevant to expatriate life in Shanghai, like the Expo or schools for foreigners' children, will be picked as a cover story. A monthly market report about Shanghai residential housing will be issued along with the supplement.

(HK Edition 03/13/2010 page2)