Cities, firms join drive to spur rental housing
Financial innovation part of long-term solution to overheated real estate market
China’s once-sizzling property market has shown signs of cooling as prices have faltered in major cities amid tough government curbs. Central authorities have reiterated on many occasions that “housing is for living in, not speculation”.
For many new settlers in the cities, owning a house is too expensive while renting means less comfort, frequent moving, lack of public services and dealing with dishonest agents.
Moody’s said the push to boost rental housing would not affect sales of property developers over the next six to 12 months, citing “the general desire of the Chinese to own their homes”.
The long-term potential is there: China’s rental housing market will reach 4.2 trillion yuan ($637 billion) in revenue by 2030, up from 1.3 trillion yuan now, according to a research report from Orient Securities.
However, the development of the market will require “continued government support to ensure the long-term effectiveness of aims such as cheaper land prices, facilitating funding channels and investment capital recycling, and promoting equal rights for owners and tenants,” the ratings agency said.
Prospective tenants check information about a public rental housing project in Beijing’s Chaoyang district.