(Yicai) Aug. 7 -- Chinese developers are scrambling to buy the land use rights to popular hot spots in major cities, despite a prolonged downturn in the country’s property market.

There was heated bidding for downtown plots in large metropolises such as Beijing, Shanghai, Hangzhou and Nanjing last month, with offers reaching as much as 40 percent above the asking price, according to think tank the China Index Academy.

One plot in Beijing’s Haidian district was auctioned off at CNY10.3 billion (USD1.4 billion) to Poly Developments and Holdings Group and Beijing Construction Engineering Group, a 19.7 percent increase on the starting price, the academy said. This was the most expensive residential plot sold by auction in July. The apartments built on the complex are likely to sell at a price of CNY900,000 (USD12,529) per square meter.

And in Hangzhou's Binjiang District, there were 42 rounds of heated bidding for one residential plot that was put up for sale at the end of July. It finally went for CNY2.7 billion (USD375.8 million) to Greentown China, almost 40 percent above the asking price.

Despite this, land sales remain sluggish. In the first seven months, the country’s top 100 developers’ expenditure on land purchases tumbled 38 percent from a year earlier, and the decline widened 2.2 percentage points from the first six months, the academy said.

Beijing logged the largest amount of land sales in July at CNY16.6 billion (USD2.3 billion), followed by Chengdu at CNY15 billion and Xi'an at CNY9.3 billion, according to the academy. Shanghai, Hangzhou, Hefei, Suzhou, Nanjing, Wenzhou, and Fuzhou were also in the top 10.

But overall, developers remain prudent over bidding for land rights as the real estate market is still tepid.

Editors: Tang Shihua, Kim Taylor