Renting an Apartment in China

Renting an apartment in China is actually a lot simplier than in a lot of Western countries. Typically, they will not bother with references or proof of employment. It’s as simple as agreeing on a price, signing the contract, then paying the deposit, agent free, and first month of rent. However, complications can occur, so it’s good to have a detailed understanding of the whole process, which I will provide here.

Apartments in China

Apartments in China

Firstly, when you find an apartment to rent, you need to pay 2 month’s deposit, 1 month in advance, and half a month as commission to the agent (the owner pays the other half). That’s a total cost of three and a half month’s rent upfront, so do make sure you have enough money. To live in a nice apartment (60sqm) in a safe, convenient location in a first-tier city (e.g. Shanghai, Beijing, Guangzhou), you’ll be paying at least 4,000RMB a month. Unfortunately, rents and property prices have skyrocketed in recent times, but salaries have not. If you don’t mind living 20 or 30 minutes from the CBD, you can find a nice enough place for around 2,500RMB in a first tier city. Second and third tier cities are a lot cheaper. You will probably want an apartment with a western style toilet as opposed to the more common squat toilet, this can really retrict your search especially in second and third tier cities where the majority of apartments have squat toilets.

RENTAL AGENTS

Most new-arrivals use property agents introduced to them by their employer. Some agents will find any excuse to rush you into renting an apartment as quickly as possible and will only show you particular buildings.

There are two things you should know. First, an administrator from the school is probably getting a kickback from the agent. After all, they’re giving the agent a lot of business. Secondly, the agent will only show you the buildings where his agency has apartments. Of course they will NOT tell you about other building or other areas which may be more suitable, as those belong to other agencies.

It’s better to try a few agencies independently. Some agents can speak a bit of English, but it’s a lot more efficient to take a Chinese friend or colleague with you. Go to various agencies in areas which you like and see what appeals to you. As I mentioned earlier, the standard commission of the agent is 1 month’s rent, half paid by the tenant, and the other half paid by the owner. All of the large agencies use standard contracts. Using an agent, you should be able to find a suitable property within a couple of days.

FEES AND UTILITIES

The burden is on the tenant to pay the various monthly fees associated with the property, such as water, electricity, management fees, and tax. In Guangzhou (a tier 1 city), a typical monthly breakdown would be as follows:

  • Electricity & water: 300RMB
  • Tax: 100RMB
  • Internet: 100RMB

As you can see, in a first tier city you’ll be up for at least an extra 500RMB a month on top of rent. You may negotiate with the owner how this is to be paid. Typically, the owner will pay the bills using his bank account, and then you will pay him according to an agreed arrangement. Here are three typical arrangements for your reference:

  1. Pay a set amount each month in advance. Where the balance is settled at the end of the contract. This way is most beneficial to the owner.
  2. Pay as you go, where each time the bills come in, the total is calculated and added to your rent for that month. It’s a little more complicated because each month the total will be different, but it’s the fairest way for both parties.
  3. The owner pays the utilities for the duration of the contract and you agree to pay him back at the end of the contract. Obviously this is very beneficial to the tenant and most (but not all) owners will refuse.

SIGNING THE CONTRACT

When you sign the contract, it will be you, the agent and the owner. The owner will receive a copy of your ID, and you’ll receive a copy of his ID. You pay the 2 month’s deposit and 1 month of rent in advance at the time of signing. It’s important to have a Chinese friend of colleague with you at the time of signing to insure you get any extra clauses you need added into the contract, and also to make sure the owner doesn’t add anything unfair. I got caught out once when I didn’t realize a clause the owner added, meant that I have to pay utilities one month in advance. It hit me just after I had signed.

EARLY TERMINATION OF CONTRACT

The owner has the right to keep your deposit if you choose to leave early. In practice, the owner is usually willing to sign with another tenant so long as you cover all the expenses. Here are your options for early termination:

  1. Contact the agent you originally leased the property through and have him find a new tenant who will sign a new contract with the owner. Naturally, you’ll need to pay the owner’s half of the agent’s fee. Using this method, you effectively save over half of your deposit.
  2. Find another tenant yourself, using popular expat bulletin boards in your area and by asking around. Modify the contract so it’s between the new tenant and the owner and have them both sign. This way you avoid the agent’s fee.

REGISTRATION OF TEMPORARY ACCOMMODATION

The final thing you’ll need to do is register your accommodation at your local police station. Each police station seems to have slightly different policies. The most basic requirement is a copy of the lease. More complex requirements involve tax receipts to prove that tax has been payed on the property. If the owner has not paid their tax, the situation can become complicated. The only way to really know the situation is to visit the local police station to find out exactly what the requirements are before signing the lease.

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