Residents in Beijing, Shenzhen lose half their pay on rent
Over 70% of 50 cities monitored in China had high rent-to-income ratios; residents in Beijing, Shenzhen and Shanghai spend over 45% of income on rent
Thinking of moving to Beijing, Shenzhen or Shanghai? Then here is something that you might want to consider.
According to a report released by the Shanghai E-House Real Estate Research Institute, residents in China’s capital Beijing put a monthly average of 2,748 yuan (US$406) into rent, or about 58% of their monthly income.
Shenzhen and Shanghai followed with monthly rent of 2,211 and 2,319 yuan, and ratios of 54% and 48%, respectively. Ratios above 45% are considered as “seriously high”.
Due to the influx of population, rental prices in Beijing, Shenzhen and Shanghai continue to rise, so despite having higher monthly disposable income per capita, the burden of rent is till heavy in the three cities, the report said.
Rent in Sanya, on the other hand, has been pushed up due to holiday crowds. Local government has introduced policies on urban and rural subsidies, and allocated funds for college students, disadvantaged groups and unemployed residents in order to tackle the problem.
Rent-to-income ratios in 34 cities, including Guangzhou, Xiamen and Tianjin, fell between 25% and 45%. But the figures are relatively high according to the report.
Of the 50 cities monitored, only 12 have a “reasonable” rent-to-income ratios, which is under 25% of people’s monthly pay.
The lowest ratio appeared in the eastern city of Wuxi, where the figure was 19%.
It is believed that people “generally feel happier” if they spend less than one third of their monthly income on rent.
Wang Mengwen, an analyst at the Shanghai E-House Real Estate Research Institute, said the numbers indicate that demand for homes to rent is still very high in medium-sized and large cities.
“It is necessary to push a market-oriented market, but government support and subsidies are needed in order to ensure sound development of the sector,” Wang said.