Shanghai's existing housing index rose at a slower pace in January as transactions dropped and prices held firm.

The index, which tracks price fluctuations of existing homes across the city, climbed 0.76 percent month on month to 2,538, extending its rally for 11 consecutive months.

The index increased 1.22 percent in December.

"The re-adoption of a five-year lock-up period for home sales, coupled with tighter mortgage policies on the purchase of second homes greatly reduced the transaction volume of existing homes last month," said Tao Ting, an analyst of the index compiler. "However, we still expect home prices to remain stable or rise a little in the short term as home owners still feel upbeat about the market."

The prices of existing homes in five downtown districts edged up an average 0.83 percent last month, compared with 1.15 percent in December.

Across the city, 56 of 59 areas monitored by the index office registered price gains in the month.

Shanghai Centaline Property Consultants Ltd, operator of the city's largest realtor chain, Friday said transaction volumes of existing homes plunged 60 percent at its branches in January from December.