Min­istry urges of­fer of more ren­tal homes

China Daily (Hong Kong) - - BUSINESS - By WU YIYAO in Shang­hai wuyiyao@chi­nadaily.com.cn

China’s hous­ing au­thor­i­ties said cities with net pop­u­la­tion inflows need to ac­cel­er­ate the devel­op­ment of ren­tal hous­ing projects, in­clud­ing en­cour­ag­ing cities to in­crease land sup­plies for res­i­den­tial ren­tal projects.

Ac­cord­ing to a cir­cu­lar is­sued by the Min­istry of Hous­ing and Ur­ban-Ru­ral Devel­op­ment, the au­thor­i­ties have pi­loted longstay ren­tal pro­grams in 12 cities — Guangzhou, Shen­zhen, Nan­jing, Hangzhou, Xi­a­men, Wuhan, Chengdu, Shenyang, He­fei, Zhengzhou, Foshan and Zhao­qing.

These cities will pi­lot mul­ti­ple-chan­nel hous­ing of­fer­ings to res­i­dents who do not buy their own homes, in­clud­ing uni­ver­sity grad­u­ates, mi­grants and re­lo­cated staff, said the no­tice re­leased on the min­istry’s web­site on Thurs­day.

The cir­cu­lar high­lights land pol­icy which en­ables newly built com­mer­cial hous­ing projects to al­lo­cate some of the apart­ments to be leased in­stead of be­ing sold. Me­trop­o­lises and large cities can pi­lot pro­grams to use land for col­lec­tive ren­tal hous­ing projects.

In terms of fi­nanc­ing, the min­istry’s cir­cu­lar said the au­thor­i­ties en­cour­age banks and other fi­nan­cial in­sti­tu­tions to strengthen fi­nan­cial sup­port for ren­tal hous­ing projects, which take a longer time to break even than other types of hous­ing devel­op­ment.

“Selling homes, par­tic­u­larly those of good qual­ity in pres­ti­gious lo­ca­tions may re­al­ize a quick re­turn. Leas­ing homes re­quires de­vel­op­ers to have strong liq­uid­ity man­age­ment ca­pac­ity and rich ex­per­tise in prop­erty man­age­ment,” said Fran­cis Ye­ung, gen­eral man­ager of sales and marketing at real es­tate de­vel­oper K. Wah China.

State-owned en­ter­prises with ex­per­tise and ex­pe­ri­ence in the real es­tate sec­tor are also en­cour­aged to op­er­ate in the res­i­den­tial leas­ing mar­ket by de­vel­op­ing and man­ag­ing large-scale leas­ing projects.

China’s res­i­den­tial leas­ing mar­ket is cur­rently dom­i­nated by in­di­vid­ual home­own­ers rather than in­sti­tu­tional oper­a­tors. About 2 per­cent of prop­er­ties in the res­i­den­tial leas­ing mar­ket are op­er­ated by in­sti- tu­tional oper­a­tors, ac­cord­ing to a re­port re­leased on the Min­istry of Hous­ing and Ur­ban-Ru­ral Devel­op­ment’s of­fi­cial web­site.

The cir­cu­lar said cities with net pop­u­la­tion inflows are re­quired to es­tab­lish gov­ern­ment-run trad­ing plat­forms for the res­i­den­tial prop­erty leas­ing mar­ket to fa­cil­i­tate ef­fec­tive, fair and trans­par­ent trans­ac­tions, with a par­tic­u­lar em­pha­sis on pro­tect­ing the rights of ten­ants.

Sheng Yue, an of­fi­cial with the min­istry’s leas­ing mar­ket su­per­vi­sion divi­sion, said that the trad­ing plat­form will also help to su­per­vise and mon­i­tor the res­i­den­tial leas­ing mar­ket.

Sev­eral cities have launched poli­cies on the devel­op­ment of res­i­den­tial leas­ing mar­ket. In Shang­hai, two land parcels were let to de­vel­op­ers to build ren­tal apart­ments for highly skilled work­ers in mid-June.

num­ber of cities that have pi­loted longstay ren­tal pro­grams

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