Rents continue to soar in China's top-tier cities

16:34, February 16, 2011      

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House agencies in China's first-tier cities refreshed the rents list in conjunction with the start of the Chinese Lunar New Year, and the trend of rising rents has become even more pronounced this year.

In the China's capital of Beijing, the financial center Shanghai and the southern metropolis Guangzhou, rents have risen by 10 percent for individual homes, stores and office buildings. In Guangzhou, the rent list is five times the length of the leasing list.

The reports on CPI in January, released yesterday by the National Bureau of Statistics, show this tendency. Individual residence prices went up 7.1 percent compared to the same period of last year, much higher than the rise in other prices.

Observers say there is a relationship between rising rents and the increase in prices caused by inflation expectations as well as the buyers-turned-tenants influenced by the regulation and control of the housing property market.

It is also argued that the massive housing rent fever this time is a compensatory reaction to the rent stability over the past two years. Thus, it is estimated that this time rents will increase until a reasonable ratio of the rent-sale price is reached.

Market overheats in Guangzhou

In Guangzhou, the rent list is five times the length of the leasing list although in Spring Festival there appeared to be a short cool-down period. Experts speculated that potential buyers who have inelastic demand have turned to the lease market in a dubious time for the housing property market, spurring the second-hand house leasing market.

New policies push rents up 10 percent in Shanghai

In Shanghai, there is also another factor that contributes to rising rents: detailed regulations on the house property tax were finalized. Insiders said that tenants would expect higher costs, which forced prices to go up.

Recruiters offer double fixed salary in Beijing

The 14 percent rise in rents, the highest among the first-tier cities, was a good reason for the employed in house agencies to be awarded higher fixed salaries. Base salaries for home agents — not including commission — rose from 1000 RMB to 2000 RMB, said a real estate agent named Guo who works in Haidian district.

By Li Yancheng, People's Daily Online
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