The average price of a new apartment in Guangzhou hit a record 7,524 yuan ($964) per square meter last month despite the government's efforts to keep property prices stable.

The new price represented increases of 85 yuan ($10) per square meter compared with December and 500 yuan ($64) compared with November.

According to statistics released by the city's land resources and housing management bureau, more than 7,200 residential apartments, covering a total space of 820,000 square meters, were sold last month. Those figures represented the biggest buying run since the government implemented measures to control the property sector in May last year.

More than 1,000 more apartments were sold in January than in December 2006, representing an additional 100,000 square meters of space.

Li Wenjiang, chief analyst at Hopefluent Real Properties, a Hong Kong-listed property agent and consultancy, attributed the price rise to the bullish sentiment in the stock market last year, which brought in extra income for local market players.

"Many residents raked in bumper harvests from the stock market last year. Some chose to buy houses with the money they earned from the stock market, either to improve their living conditions or as another investment to dilute their risks from playing the stock market," he said.

"Their purchases increased demand, which drove up prices."

He said apartment prices in Guangzhou would continue rising this year despite the possibility of dips after Spring Festival, which falls on February 18, and before May.

And he predicted that apartment prices would range from 6,800 yuan ($871) to 7,500 yuan ($961) per square meter this year.

Li based this prediction on the assumption that demand for residential apartments would remain strong.

He also said the price of smaller apartments those measuring less than 90 square meters would likely fall, lowering the average apartment price this year.

Some 90,000 residential apartments are expected to go on sale this year. Apartments with less than 90 square meters of floor space are expected to account for no more than half that amount.

Editor: Yan