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China: Working and Living

Buying and Renting Real Estate

This page was last updated on 30 July 2019.

It is likely that your employer will help you to find an apartment, as this is very difficult for lone foreigners, except  in the larger cities such as Beijing, Shanghai and Guangzhou, where there are agencies that serve the expat market. Of course, expat salaries are high enough in most parts of China that you should be able to afford upper-level accommodation.

In Beijing, many expats live in one of a number of newly-built high-rise apartment blocks, some with pools and exercise facilities. There is no formal separation between the Chinese and foreign communities, but naturally they tend to cluster. The most popular district is Chaoyang, which has a metro and is home to many of the larger international firms. ‘Villas’ (detached houses) in gated communities in Shunyi, near the airport, are a popular choice for families with children, partly because there are two prominent international schools there, although the commute is a up to an hour at peak times.

China is unusual in not taxing immovable property, and for nearly a decade the authorities have mooted changing this. Pilot projects were first launched in Shanghai and Chongqing in 2011 and have been repeated elsewhere. In the current year (2019), it has looked like a property tax would finally be introduced, but it has been put on hold again, with the government claiming that conditions are not currently suitable.

The housing market has shown remarkable increases in recent years, actually hitting 25% in 2010, and in some areas, such as Shanghai, it has been overheating. The government has taken various steps to try to cool the market down.

Property is one of the major sources of wealth in China. The government sold many properties to locals for a pittance in the 1990s, since when property prices have soared almost continually. Nearly two-thirds of all residential sales are for second or even third homes. This is why, despite its gigantic population, China actually has more than 50 million unsold properties. Indeed, whole ‘ghost cities’ have been built.

The excess supply is one factor that leads some analysts to believe that buying Chinese property as an investment is currently risky. The volatility of the Shanghai Composite Index is another factor – there was a massive boom and bust period in 2015-2016. The US-China trade war adds further doubt to the situation.

 

 

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