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How to Buy the Best Property in China?

The media frequently reports on how Chinese property buyers flood marketplaces in nations. We hear less about foreigners buying real estate in China, where the property market has expanded dramatically in recent years. Real estate accounts for a significant portion of the wealth amassed by inhabitants in larger cities. China may be the ideal option for residential property investments. However, many foreigners acquire real estate in China for personal reasons or because they have lived there for a period. If you want to buy the best property in China, you may use the best Chinese real estate company for your requirements.

Buying Land in China

Foreigners can buy land in mainland China or Hong Kong. Instead, you have to lease land for up to 70 years. The government owns urban land, and you must execute a land grant contract with the county’s land administration department before leasing land. Instead, the land is held collectively by the people and managed by the state.

Foreigners are eager to purchase property in China

China has one of the world’s most overheated real estate markets, and prices have risen dramatically in recent years. However, China has attracted an increasing number of entrepreneurs and business leaders, leading to an increase of foreigners seeking to move here for privacy concerns. Furthermore, many overseas Chinese desire a place to reside in their home country as a way to reconnect with their roots. According to the legislation, foreigners are permitted to purchase one property for residential purposes in China.

China’s real estate sector has emerged as an essential pillar of the economy.

China’s real estate sector is younger than its worldwide rivals. But it has quickly become a foundation of the Chinese economy, accounting for approximately 7% of China’s GDP over the last two decades and contributing to the prosperity of other industries that rely on the property market’s growth.

Owning real estate and land

In China, real estate ownership and land use rights are distinct concepts. While the duration of land use is limited by applicable legislation, real estate ownership is not. China practises socialist public ownership of all land, no single individual or organisation can own land. You might purchase the wonderful china property and choose the Chinese real estate company to obtain it. When one buys real estate in China, they are leasing land usage rights that will expire in several years.

Find a real estate agent.

Although it is not legally required, they recommend working with a local real estate agent familiar with the market and local regulations. Agents can be found online or through contacts. It is to conduct a due investigation to ensure that the agency is genuine and has a track record of assisting foreign purchasers.

Offer and pay the deposit.

When you’ve located a property that meets your requirements, it’s time to prepare an offer. Once agreed upon with the vendor, you pay a guarantee of 1% of the purchase price to reserve the unit.

Sale and Purchase Agreement (SPA)

The following stage is to prepare the Sales and Purchase Agreement (SPA), which includes data like:

  • The sale price
  • Payment of taxes
  • Payment instalments and terms

China’s Property Prices

Property prices have risen in China, particularly in larger cities such as Shanghai, Shenzhen, and Beijing. In a country with about 1.4 billion inhabitants, it’s not astonishing that younger people aspire to urbanise and relocate to bigger cities. However, there are limits to work and buying property in various provinces, since China has so-called Hukou (户口本), comparable to domestic passports or identity cards. Sure, rapid economic progress has increased the Chinese people’s riches. However, the rise in house prices is primarily due to generous housing loans, not to mention the shadow banking sector, which is now as large as Mexico’s economy.

Cooling measures by the government.

While shadow banking is more difficult to manage, the government is doing everything to cool the property market, such as limiting the number of houses available or requiring a downpayment on first and second purchases. Beijing and Shanghai (and, more recently, Shenzhen) are cities where property prices have skyrocketed, resulting in significant economic gains for residents. When the buyer and seller sign the SPA, they should pay between 20% and 30% of the purchase price. It also needs to be notarized. You must register the acquisition at the government level and execute a new contract witnessed by a government official.

Mortgages

Before applying for a mortgage, a foreign person is operated on a work visa in the city where they want to buy a home for at least a year and have a Chinese sponsor (usually an employer) who can guarantee that the applicant’s salary is sufficient to cover the loan. To be authorised for a mortgage, the applicant must provide many pieces of papers, including their passport, residency permit, certification of marital status, evidence of employment, proof of tax payment, labour contract, and company business licence. After approval, applicants can take out the loan at the same interest rates as Chinese citizens.

Featured image: Unsplash

Last Updated on 2024/03/10

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