Compared to Wang, Lin Hong can be considered luckier as she managed to secure the purchase of her family’s second home and avoid the hike in down payment fees, as stipulated by the new property policies, after braving the crowds at the transaction centers on Mar 24. She added that the transaction deadline for the day was extended from 9 pm to midnight due to system problems caused by the overwhelming number of applications.

According to the new policies, local families with one property will have to pay at least 50 percent down payment for their second homes.

This fee is raised to 70 percent if the house is above 140 square meters or priced above 4.5 million yuan ($695,000) and is located within the inner ring, or if the home is priced above 2.3 million yuan and is located beyond the outer ring. Home-buyers previously had to pay a 40 percent down payment for their second homes.

The second home that Lin purchased is a three-bedroom house located in the Xujing area in Qingpu district — it falls under the latter category.

"It is hardly imaginable for white-collar people like us to pay 70 percent down payment as per the new rules," said Lin.

The 31-year-old said that her family had started looking for a second home a year ago and they were about to buy apartment in the Gubei area in Changning district when the landlord raised the asking price by 500,000 yuan.

"We thought that the second-hand home prices were insane. We later switched to looking at new houses located in suburban areas instead," said Lin.

Gu Jinshan, director of Shanghai Housing and Urban-Rural Development Management Committee, said that a surge in Shanghai’s property prices started in the second half of last year and had become even bigger at the beginning of 2016. He noted that there are several factors behind this, such as loosened policies for mortgage and deed tax cuts, limited supply of homes, the return of investing and speculative demand, as well as irregular practices of some property agencies.

Jiang Yizhen, a store manager with property consultancy Centaline of Shanghai, said that one of the most extreme examples of price hikes took place in February before the Chinese New Year when a 102-sq m unit in Yangpu district was priced at an uncharacteristic 4.3 million yuan.

Jiang said the owner raised his asking price every time a potential buyer agreed to the new price and he learned that another property agency actually managed to sell the apartment for 5.85 million yuan. However, in the wake of the new policies, Jiang said that some landlords have already started to lower their asking prices.

But it seems that property prices are not just causing grief for people in Shanghai. Over in Nanjing, Jiangsu province, Li Xue is facing the same problem.

After witnessing her peers struggle to get a home in Shanghai, Li decided to head back to her hometown in Nanjing to find a home.

To her surprise, home prices there are out of her reach as well. According to the 21st Century Business Herald, Nanjing ranks among one of the top 10 cities in China for new home price increases, experiencing a 23 percent growth in the past six years.