Rental housing may further lower house prices in Kunming

The average house price in Kunming has dropped by 884 yuan in July to 14,702 yuan/square meter, according to an August 4 report on Kunming Daily app. It is the second month for Kunming houses to fall below 15,000 yuan following May 2020.
The Kunming rental-housing management center began confirming the applications from those in need: college graduates, migrant workers and other new citizens, said a Yunnan Daily app article on May 13. Over the past nine years, the spring city has provided rental housing to over 60,000 less privileged families.

The housing problem has been a headache for young people and migrant workers in Kunming and other Chinese megacities. Luckily, the national authorities have stepped up policy support in rental housing.

“Land prices, real estate prices and market expectations must be stabilized and the development of rental housing, coupled with supportive policies in terms of land use and taxation, must be accelerated,” said a China Daily report on the CPC key meeting on July 30. The meeting set out China’s economic policy directions for the second half of this year.

Ni Hong, vice-minister with the Ministry of Housing and Urban-Rural Development, said a new guideline aimed at accelerating the development of affordable rental housing is poised to ease the pressure on new urban residents and young people, according to another China Daily report on July 7.
In the context of such favorable policies, the Chinese cities proposed rental housing plans one after another, said an August 5 article on China Securities Journal.

The articled added that Shanghai will build 400,000 sets of affordable rental housing during the 14th Five-Year Plan period, accounting for about 40% of the city’s total housing supply. Guangzhou will build a diversity of 1.31 million houses in the coming five years, 600,000 of which belong to rental housing for the less privileged.

Hefei city in east China’s Auhui province will build up over 20,000 rental houses this year, said a local news app on August 4.

As the Ministry of Housing and Urban-Rural Development has asked the Chinese cities to set forth their goals by the end of October this year, Kunming will also have more rental houses in the coming years. And this might contribute to even lower house prices in the city and help cure the “headaches” of many youngsters.

“Under the current high house prices, the housing problem of new citizens and young people should be mainly solved by developing the rental-housing market,” said Zhang Zhi, a researcher at the Chinese Academy of Social Sciences.