2016年CRI China to Further Promote Housing System Encouraging Renting and Purchasing

China to Further Promote Housing System Encouraging Renting and Purchasing

A recent survey by the Global Cities Business Alliance, a London-based non-profit, has found Beijing is - by far - the most expensive city in the world to rent an apartment. 

Compared with the world-wide range of "affordable 1 housing" rate, which is somewhere between 30 to 40-percent of a person's monthly income, the rate in Beijing is well over 120 percent. 

Uncertainty 2 among would-be home-buyers in Beijing and other cities in China about the property market has pushed many to the sidelines, pushing up rental 3 rates as people choose to rent, rather than buy. 

To try to counter this trend, the State Council, China's Cabinet, is moving to promote a housing system which encourages both renting and purchasing. 

This includes subsidies 4 for those who qualify for public housing but choose to rent. 

At the same time, non-registered workers from other cities who live in urban areas with a stable job, as well as newly-employed undergraduates and young professionals, such as doctors and teachers, are also going to be included in the subsidy 5 scheme. 

Liu Hongyu with Tsinghua University says more emphasis needs to be put on regulating China's rental market.

"We didn't put as much emphasis on the rental market as we did on the selling of houses in the real estate industry. Now more should be done to establish a more regulated rental housing market to meet people's needs." 

Zhang Dawei, chief analyst 6 at property agency Centaline, says this move should be able to stabilize 7 housing prices, and also reduce speculation 8 in the property market. 

"Currently, due to the continued rise in housing prices, many purchasers fear they may lose the chance to buy properties at a low price, so they tend to choose speculation. This has resulted in an irrational 9 jump in housing prices. Many people focus too much on the property's price appreciation 10 in the short term, rather than a long-term benefit in the rental process." 

The new policies outlined by the State Council also allow for turning commercial flats into rental flats. 

Tax breaks and other preferential policies will also be applied 11 to the rental market.

In addition, stricter supervision 12 will be imposed on rental agencies to better-protect tenants 13' rights.

Regardless, Yang Hongxu with the E-house Research Institute in Shanghai says more concrete measures should be taken to address the lingering problems in the rental housing market.

"Local governments all have different policies. Often local governments will rent or purchase existing homes and turn them into subsidized housing. But now, the problem is that a lot of local governments just don't have the money to do this anymore. There are a lot of ways to fix problems in the social housing market, but it's often difficult to put them into practice. This is why we think there needs to be more policies put out at a national level." 

As workers gravitate toward big cities like Beijing for work, it also pushes people further outside the city where rental rates are cheaper.

At the same time, a recent survey by Xinhua has found around one-fifth of the roughly 7.7-million migrant workers in Beijing either live underground in buildings without proper amenities 14, or at their work sites. 

For CRI, this is Li Jianhua.