Last year, the central government implemented a series of policies aimed at cooling the market and creating more of a balance between home sales and property rentals.
A June 2016 State Council document affirmed that firms that specialized in rental services would receive favorable benefits in terms of taxes and land allotment.
The document added that firms were encouraged to rent out their inventory of new residential homes, and establish links with intermediary agents.
At present, 56 cities have put forth rental incentives, such as reduced taxes and rights protection. And over 10 cities have increased land supply for home rentals.
By the end of 2017, the home rental market had grown by about 16.7% year-on-year, compared to just 8-15% annual growth from the previous five years. Revenue from the home rental market is expected to jump from ¥1.3 trillion to ¥4.2 trillion by 2030.
Unsurprisingly, a number of real estate giants are moving to develop properties purely for the rental market. Country Garden, China Vanke, Poly Group, Cifi Group, Dalian Wanda, and Longfor Properties Co Ltd. have all moved in.
Country Garden, whose sales hit ¥500 billion in 2017, has announced plans to build 1 million apartments over the next three years. The project is targeting young professionals.
In a news conference on December 20th, Founder Yang Guoqiang said, “China is promoting home rentals. This shows the country’s concern for its people. We are happy to play a part.”
Meanwhile, Vanke has unveiled plans to issue up to ¥35 billion in direct debt financing to go towards boosting liquidity and financing rental projects. Vanke, too, is said to be upping its number of new-build rental apartments.
For more information about Beijing apartment renting, please follow our website.