(Yicai) March 25 -- Chinese artificial intelligence startup DeepSeek, the developer of a cost-effective alternative to OpenAI's ChatGPT, is catalyzing a property market rally in eastern China's Hangzhou.

Hangzhou's secondhand home sales are projected to jump 40 percent year-on-year to 12,000 units this month, reaching the highest level since 2022, according to Beike Research Institute. Last month, secondhand home sales more than doubled compared to a year earlier, reaching nearly 6,000 units.

DeepSeek's rapid rise has become a key driver of property sales in the capital city of Zhejiang province. The company's large language model, DeepSeek-R1, topped the download charts for free applications on Apple's App Store in both China and the United States on Jan. 27, surpassing ChatGPT. The Chinese LLM is gaining traction due to its powerful performance despite its low cost.

The growing tech company is attracting new talent to the area. Real estate agencies have begun advertising properties with the tag "Near DeepSeek HQ" in Hangzhou's Gongshu district, where DeepSeek’s headquarters is located.

"We’re seeing more out-of-town buyers," a local real estate agent told Yicai. "While prices haven’t risen from the levels seen in late 2024, transactions are accelerating. Prime listings now sell within a week."

Lan Yantao, a branch manager of real estate brokerage Lianjia, mentioned that instead of the usual businesspeople, the primary buyers are now tech professionals.

"Over half of my recent clients work in tech, including an information technology professional born after 1995 who just bought a CNY15 million (USD2.1 million) luxury property," Lan said.

Before DeepSeek, Hangzhou was already known for tech giants such as Alibaba Group Holding and NetEase. The city's core digital economy industries generated CNY630.5 billion (USD86.8 billion) in added value last year, accounting for almost 29 percent of the municipal gross domestic product -- nearly three times the national average, according to official data.

Hangzhou’s tech ecosystem has been attracting talent for over a decade. The city’s permanent population surpassed 12.6 million as of last December, an increase of 3.9 million since 2010, based on official statistics.

Editors: Dou Shicong, Emmi Laine