Reviews of Real Estate Developers in China

Economy of China

China is one of the most economically developed countries in the world, the world leader in GDP and industrial production, the most populous country in the world (the permanent population exceeds 1,411,750,000 inhabitants), the largest exporter and one of the largest markets in the world. The People's Republic of China is a member of numerous international organizations: the UN, the World Trade Organization, the Asia-Pacific Economic Cooperation, the G20, BRICS, the Shanghai Cooperation Organization. The state has a common border with the Russian Federation, the Democratic People's Republic of Korea, Mongolia, Vietnam, Myanmar, Laos, Bhutan, Nepal, India, Pakistan, Tajikistan, Afghanistan, Kyrgyzstan. The administrative division of the country provides for the presence of 22 provinces, 5 autonomous regions, 4 municipalities (Beijing, Shanghai, Chongqing, Tianjin) with the capital in Beijing. The People's Republic of China is a leader in science, accounting for almost a quarter of all global expenditure on research and development. China is located in East Asia and is the second largest country in Asia and the fourth largest in the world, behind only Russia, Canada and the United States. The country is extremely diverse in climate, with several climate zones ranging from subtropical in the south to sharply continental in the northwest.

The economic well-being of the People's Republic of China is based on developed industries, agriculture, finance and trade, tourism, construction and real estate. Since the 1980s, the country has experienced rapid economic growth, with GDP figures growing by up to 15% per year, later the growth slowed down slightly and amounted to 8% per year, which was one of the highest in the world. The colossal growth of the construction sector began in the early 1990s and has not stopped to this day. The growth of the country's urbanization has led to the construction of a huge number of new districts in numerous cities in China. Tens of thousands of construction companies have been building residential and commercial property clusters to meet the growing demand from local residents and the many people moving in as part of the internal migration process. China has a fairly high rate of rural-urban migration, as well as from less economically developed provinces and cities to more developed ones. The most popular points of attraction for migrating Chinese citizens are Beijing, Hong Kong, Shanghai, Guangzhou, Chongqing, Nanjing, and Harbin. A huge number of Chinese citizens move to receive higher salaries, access to the developed infrastructure of megacities, and education for their children in the best schools, colleges, and universities. The direction of internal migration is from the northwestern regions of the country to the rich southeastern provinces. Real estate in China is represented by all types of commercial and residential properties. A significant share of residential real estate is intended for families with modest incomes. Providing Chinese citizens with comfortable and affordable housing is one of the priority goals of the Chinese government. A significant number of multi-storey residential complexes with different types of apartments are being built in the country, from small studios to spacious penthouses in elite residential complexes. A large number of individual housing units are also being built in China: houses, mansions, cottages and villas with garden plots. The development of industry and trade requires a large number of commercial properties that are being built throughout the country by numerous Chinese developers: retail premises, production sites, office buildings, warehouses.

Investing in Chinese real estate

According to official data, more than 100,000 developers are constantly working in the People's Republic of China, each of which has passed state licensing.

Investing money in Chinese real estate is a way to preserve and increase capital. Chinese real estate is distinguished by a wide variety of objects, from which it is easy to select objects that are suitable in price and other important characteristics for a specific buyer, a fairly high quality of construction, the attention of the state and developers to urban infrastructure. Chinese real estate is suitable for short-term and long-term rent. It is important to remember that foreigners, in accordance with local legislation, can only purchase one apartment per family and do not have the right to rent it out.

Residential property investment has accounted for the majority of property investment in China in recent years, making a significant contribution to the construction industry and the overall economy. Following the peak of residential property sales in 2021, China’s property market has slowed somewhat in most cities, but some cities have seen significant increases in sales, notably Shanghai and Xiamen, where residential property sales grew by around 9%. The Chinese government has taken steps to stimulate property sales, lowering the minimum down payment requirement to 40% in Guangzhou and Shenzhen, and lifting restrictions on property purchases in many smaller cities.

Buying Property in China for Foreigners

Foreigners must have lived in the People’s Republic of China for at least one year on a work or study visa to be eligible to purchase property. Foreigners who purchase property in China will not have full ownership rights, but will receive an apartment from the government for temporary use for a period of less than 70 years. When buying commercial real estate in China, this period will be even shorter. The seventy-year period begins not from the moment of purchase of the property, but from the official receipt of the land plot by the developer for construction work. After the expiration of the specified period, buyers or their heirs who continue to own the property have the right to extend this period for a certain fee, which is currently at least $ 2.5 per 1 square meter of area. A foreign citizen and his family do not have the right to purchase more than one apartment, and must also sign an official statement that they will not rent this apartment. An unusual moment for foreigners is the inclusion in the total living space in official documents for real estate not only living space, but also public areas, which include a staircase and an elevator. A foreign citizen is required to issue a certificate confirming the fact of legal residence in the country for more than 1 year. It can be obtained from the local public security bureau. Due to the fact that the buyer is a foreign citizen, the purchase and sale agreement must be certified by a notary in China. In addition to a passport, a document confirming permanent registration at the place of residence, an employment contract, and a bank statement are required to conclude the contract. In addition to the contract, the foreign buyer signs an official statement in which he or she undertakes not to use the property for commercial purposes or to rent it out. Next comes the mandatory written application of the foreign citizen to the foreign affairs office, which issues a permit to purchase housing. After the purchase has been approved by government agencies, the buyer must pay 30% of the property value as a deposit. Note that all payments in the PRC are made in the official currency of the country - yuan. After paying the deposit, the buyer submits documents to the local property rights office, where the property rights are registered in his or her name. After this, the buyer pays the seller the remaining part of the property value. The buyer receives a certificate of ownership in a few weeks.

Commercial Real Estate Development in China

The commercial real estate market in China is rapidly developing. More than 20 million square meters of new office space is expected to be commissioned between 2025 and 2027. The four largest Chinese cities will account for approximately 4 million square meters of new office space.

In Beijing, more than 1.65 million square meters of office space is expected to enter the real estate market by 2028. Of this, approximately 150,000 square meters will be completed by 2025. The main tenants of office real estate are the financial, professional services, as well as companies from the technology, media and telecommunications sectors. The Beijing retail market will be replenished by 1,040,000 square meters of real estate in 2025. Most of the retail space is planned to be opened in suburban areas. Office space is the focus of investors in Beijing's commercial real estate, but other areas of commercial real estate are becoming increasingly popular: hotel real estate, affordable apartments for long-term lease, retail space.

Real Estate Prices in China

Commercial real estate price dynamics in different cities in China in 2024:

• In the four largest cities in China, new commercial real estate prices fell by an average of 4.2%, while existing commercial real estate prices fell by 8.8%;
• In Beijing, new commercial real estate prices fell by 3%, while existing commercial real estate prices fell by 7%;
• In Guangzhou, new commercial real estate prices fell by 10%, while existing commercial real estate prices fell by 12.5%;
• In Shanghai, new commercial real estate prices increased by 4.5%, while existing commercial real estate prices fell by 5.5%.

In Shanghai, 1.7 million square meters of new office space is planned to be delivered in 2025, most of which is planned for delivery in new, developing locations in the city. By 2027, the total amount of office space in Shanghai is expected to exceed 20 million square meters. Several well-known shopping malls are expected to enter the Shanghai market in 2025. The first three quarters of 2024 have seen a rise in investment in Shanghai's commercial real estate, with demand driven by office buildings in the city center. The promising areas of Shanghai's commercial real estate market include affordable housing for long-term lease and traditional commercial real estate.

The supply of Class A office real estate in different cities in China:

• In Beijing, the supply of Class A office real estate is about 585,000 m², with a vacancy rate of almost a quarter (22.5%);
• In Shanghai, the supply of Class A office real estate is about 1,900,000 m² with a vacancy rate of 23%;
• In Shenzhen, the supply of Class A office space is approximately 900,000 m² with a vacancy rate of 30%;
• In Guangzhou, the supply of Class A office space is approximately 1,050,000 m² with a vacancy rate of approximately 25%.

Reviews of Chinese construction companies

Our website contains reviews of Chinese developers left by property buyers. Reading the reviews will allow you to form a balanced opinion about their reliability, advantages and disadvantages, quality and timing of construction, quality of finishing, working conditions.