BEIJING (Reuters) – The Chinese government has said the cost of renting a home in cities should not rise by more than 5% a year – its first move to cap rental prices and part of efforts to provide more affordable housing.
The plight of low-income individuals has come to the fore of policymaking as President Xi Jinping pledges to narrow wealth disparities in efforts to reach so-called “common prosperity”.
Rents in big cities have surged over summer, fuelled partly by inflows of college graduates seeking employment. Beijing and Shenzhen began implementing measures this year to boost the supply of rental properties.
“New urban residents and young people have worked for a relatively short time and have little income, so their ability to buy homes and pay rent is weak,” Vice Housing Minister Ni Hong said on Tuesday.
“In big cities, 70% of new residents and young people rent homes, but homes that are more affordable are more remote and properties in more desirable locations are more expensive, posing practical difficulties,” Ni told a press conference that followed guidance on the cap by the housing ministry.
In recent months, big cities have issued draft home leasing rules seeking to better protect the rights of renters, including bans on landlords from collecting more than the equivalent of a month’s rent in deposits.
Authorities will also crack down on abusive practices by real estate firms and online property platforms such as overcharging renters.
The rules are part of a sweeping clean-up of the property market over the next three years to rid what the government describes as irregularities that have stoked speculation and pumped up home prices.
(Reporting by Ryan Woo; Editing by Edwina Gibbs)
