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Housing Market

There are villas, modern western flats, and traditional housing available in Beijing. Every Chinese structure is based on the principle of balance and symmetry also known as feng shui (wind and water). Western style apartments are concentrated in areas specified for foreigners. Large expatriate communities include Shunyi (villa housing) with families and embassy workers, Sanlitun for a foreigner party scene, Wudaokou is the student hub, Lido and Chaoyang Park has been a long-established foreigner hangout, and Wangjing is becoming increasingly an expat spot. The prices in these areas may be very high because of their popularity and proximity to the city center and various amenities.

The average price of houses bought with loans in Beijing is 1.7 million RMB. On average, property sells for 8,738 RMB per square meter. In general, prices increase significantly within each Ring Road approaching the city center. They also increase the higher the floor level. Unfortunately, the housing market may be among the most expensive in the world when compared to per capita income.

It is important to note that in China, private ownership of land is not an option. The land can only be "rented" from the government. This means the tenant owns the space between the walls of the property and not the actually land that it is built on. Attached to this concept is the fact that all properties are bought on a 70-year lease. Since the PRC is only been in existence 60 years, it is unclear what the implications of this policy will be.

Expats Buying in China

Foreigners who intend to buy a house in Beijing do have a certain amount of paperwork to wade through, although many restrictions have recently lifted. They need a certificate issued by the Beijing Municipal Public Security Bureau to prove that they have stayed in China for a significant amount of time (at least one year) and have legal reason to seek property. This law does not apply to Overseas Chinese, Hong Kong, Taiwan and Macau residents, who are automatically eligible. The laws dictate that foreigners should only use and dwell in the house themselves and not buy a house for other purposes.

How to Search for Real Estate

Estate Agent

Most expats employ the services of an agent because of unfamiliarity with the area and laws, as well as difficulty with the language barrier. An estate agent is a useful resource for finding the right place quickly and ensuring a clean sale. An agent will provide you with a description of available properties, escort you to viewings, make sure your contract complies with expected standards. Agencies are easy to find, but ask for recommendations from friends and contacts to find the best candidate. Estate agents are self-regulated, working under codes of conduct regulated by their professional bodies. Look for agents who are members of organizations such as the Royal Institution of Chartered Surveyors and the National Association of Estate Agents. Larger international agencies tend to be more expensive, so if you are able to speak Chinese, a smaller or local real estate agency chain is more affordable.

The average commission for completing a sale in China is 1 percent, but is often as high as 3 percent in Beijing which is the upper limit regulated by law.

Online Listing

Online listings can give you a great feel for the market and allow you to determine if a place fits your specifications before you spend time going to look at it.

• http://realestate.classifieds1000.com/China
• http://www.beijingrealestate.com/agentlisting_sub.asp
• http://www.mondinion.com/Real_Estate/country/China/
• http://beijing.craigslist.com.cn/rea/

Public Postings & Forums

Many places have billboards offering advertisements for a variety of goods and services. Watch these boards for useful postings. Laundrettes, cafes, grocery stores, community centers, and bars all might have private ads.

Expat and social forums and classified's are another resource for job seekers. You can get a realistic expectations of what it's like to live in Beijing as well as make helpful contacts. Check out Easy Expat's Classifieds for China as well as the forum to connect with expats there.

Networking

If you know anyone in China- get in touch! Friends and family, or any contact you have may have information about places available or advice on how and where to look. If you have already moved to Beijing, talk to people and make contacts.

Newspaper

Several papers have a helpful classified's section.

• China Daily
• China Today
• Morning Post
• The Beijinger classified's
• City Weekend classified's

Contracts

Before you sign any documents, including your contract with your realtor, have it looked over by a lawyer or advisor. If the contract is in Mandarin, which it usually will be, it might be worth the investment in a professional translator. It is extremely important that every element of a contract be understood before signing.

After you have found your potential home, it is time to make an offer. This offer normally comes in the form of a letter which outlines the offered price, payment schedule and any conditions attached to the purchase. After the offer has been accepted a 1 percent deposit is normally paid. Once that is paid, the owner and buyer will sign a stamped sales contract. An initial down payment of 30 percent is made to the seller.

Once the loan is finalized, all the necessary documents are checked once more by both the agent and the bank. If everything is in order, buyer and seller can then proceed to the district property trading center to transfer the name on the title deed. When everything is in order and the ownership certificate has been issued it is up to the buyer to pay the remaining 70 percent of the purchase. This completes the sale.

Mortgage

Once the contract is received, many foreign buyers proceed to shop for a mortgage. Most Chinese actually pay for property in cash. Loans are most commonly available to foreigners from large Chinese banks such as Bank of China and China Construction Bank.

First-time buyers of homes smaller than 90 square meters are qualified for loans for 80 percent of the price of the home and a 30-percent discount on the benchmark interest rate. This usually leaves the new buyer with a monthly payments of about 9,000 RMB.

Tips:
• Make multiple copies of passport, residence permit and work permit. 10 copies sound just about right.
• Keep receipts for everything, and make people sign for everything money-related to say they have received the money.
• Avoid giving money directly to owner or agent without a third party witness.
• Make sure the property is owned by the landlord with no encumbrance.
• Make sure all the owners in the deed give their written consent to sell, especially in the case of multiple owners, which usually happens in China, no matter how insignificant the relationship to the landlord.
• If buying a brand-new property, make sure the developer has all the five required certificates, including State land use right certificate, construction land planning certificate, construction project planning certificate, construction project commencing certificate and the sales certificate.

Fees

In addition, there are several miscellaneous fees on the sale of a residence. These fees are calculated in relation to the price of the property.

• 3 percent stamp duty
• 2 percent maintenance taxation
• 1.5 percent contract tax
• 0.1 percent stamp duty for a re-sale property

Auction

Buying at auction is very exciting and can offer you a significant savings. Note that most properties are sold cheaply, but may be mere shells in need of extensive renovation. Many sales only concern land. This option is not recommended for first time buyers, and even experienced buyers should bring a friend or advisor as a second opinion.