SHANGHAI - Sales of residential property in Shanghai hit the lowest point in February since 2006, according to a survey released on Tuesday by the Uwin Real Estate Research Center, a Shanghai-based information provider.

The survey shows that the area of residential buildings sold in February was just 178,000 square meters (sq m), down 83 percent compared with January and 44.65 percent compared with the same period last year. The average transaction price fell 10 percent compared with January to 20,625 yuan ($3,138) a sq m.

"Looking at the entire property market in the city, you can see the housing market in central Shanghai plunged the most. The area of residential buildings sold in February dropped by 91 percent compared with January," said Jin Yingjun, an analyst from Uwin.

"In February, 400,000 sq m of new residential buildings were put on the market, down by 24 percent compared with January. But this new supply was still 2.2 times the area sold in the month," Jin said.

Related readings:  Home price growth slowed in February  China to release new house price survey scheme: NBS  Beijing home sales slump in February  Premier reiterates determination to cool property sector

A total of 57 high-end residential apartments, priced an average of 40,000 yuan a sq m, were sold in February, the smallest transaction volume since March 2009.

Only 105 villas were sold in February, the lowest number since 2006.

According to Jin, housing prices in Shanghai dropped 10 percent on average in February largely due to the stagnant sales of high-end apartments. In addition, the supply of moderately priced apartments remains insufficient, so sales cannot rise significantly in the following months.

To curb soaring housing prices in Shanghai, the municipal government imposed a property tax in late January. Shanghai's Housing Guarantee and Administration Bureau adopted a regulation on Feb 19 prohibiting new home sales to locally-registered families who own two or more homes and non-local registered families who own at least one home. Those rules and the slack season that comes with the Spring Festival holiday are the reason the housing market plummeted in February, Jin explained.

"These newly introduced government policies have forced quite a number of investors to quit the housing market, for the difficulty and cost of investing in property, especially at the high-end, has significantly increased. The fall in the transaction volume lowered home prices," said Xue Jianxiong, a senior analyst from China Real Estate Information Corporation, a leading provider of real estate information, consulting, and online services in China.