Chinese realty agencies vow to maintain rents, release more units amid soaring urban rents

Source:Global Times Published: 2018/8/20 22:38:39

Real estate rental agencies, including Homelink and 5i5j.com, publicly committed to refrain from raising rents and to release more housing, but industry insiders said that the government should find more ways to increase housing supply in a bid to solve the problem at its roots.

At a symposium held by the Beijing Real Estate Agents Association on Sunday to address public concerns about rising urban rents in China, ten real estate rental agencies announced self-regulatory measures to stop "malicious competition" such as using loans to acquire apartments at above-market prices, a practice that is said to be driving rents higher, Beijing Evening News reported. 

They also announced that they would release their entire stock of housing, a total of 120,000 units to the market, to stabilize rents.

Yan Yuejin, a research director at E-house China R&D Institute, told the Global Times on Monday that the move is immediate and pragmatic, since it could hit some practices such as relying on hoarding to make money, and it would also guide the sound and healthy development of the domestic rental market.

"Sufficient supply will directly curb soaring rents," Yan said.

Rents in cities like Beijing, Shanghai and Guangzhou and Shenzhen in South China's Guangdong Province, showed month-on-month increases in July, media reports said.

The average rent in Beijing was 91.5 yuan ($13) per square meter in July, up 2.2 percent on a monthly basis, financial news site 21jingji.com reported on Thursday, citing industry data.

However, an industry insider told the Global Times on Monday that a shortage of housing is the major cause of soaring rents, rather than the hoarding behavior of some agents.

"The government still has to draft more policies to regulate the rental market, as well as find more ways to ensure an adequate supply in the market," the industry insider noted.

Late on Monday, 5i5j.com announced it would release 20,000 rental units in two months and promised that rents of these units would not be increased compared with the levels in August. Homelink vowed to release 80,000 houses in the Beijing market in the next three months and said it would maintain rents at the current level.



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