Nine State Authorities Jointly Issue Measures to Ensure Tenants to Enjoy the Same Right as Home Buyers
On Jul. 20, 2017, the Ministry of Housing and Urban-Rural Development and other 8 state authorities including the National Development and Reform Commission, the Ministry of Public Security, the Ministry of Finance, the Ministry of Land and Resources, the People’s Bank of China, the State Administration of Taxation, the State Administration for Industry and Commerce, and the China Securities Regulatory Commission, jointly released the Notice of Accelerating the Development of the Housing Rental Market in Large and Medium-Sized Cities with a Net Influx in Population.
The Notice points out the thriving demand for rental housing by new coming residents in large and medium-sized cities. And in contrast, problems like deficiency in total rentable house sources, the unregulated market order, and incomplete policy system, appear especially in certain large and medium-sized cities with a net influx in population. Consequently, the market for rental housing fails to play its role in addressing the housing problem of new citizens in these cities as expected.
The Notice puts forward five particular requirements. First of all, that state-owned enterprises should play a dominant role. Related state-owned enterprises in large and medium-sized cities with a net influx in population should be transformed into rental housing enterprises so as to fully exert their advantages in stabilizing the rent and rental period, activating the rental housing stock, and increasing effective supply in rental housing. Secondly, the government in different places should establish their house renting platforms. In order to address problems such as fake rental housing sources and nontransparent information, large and medium-sized cities with a net influx in population should establish service platforms for house rental that provide convenient service on release of rental information and guarantee benefits on both sides. Thirdly, multiple measures should be adopted to increase the supply of rental housing. Regarding land policy, through such measures as increasing both the land use for construction of rental housing and the construction of accessory rental housing in commercial housing projects, the supply of rental house should be increased; in the aspect of financial policies, measures should be adopted to enhancing the financial support to house renting enterprises and encourage development-based financial facilities like financial agencies in the bank industry to expand their credit and loaning support to rental housing projects. Regarding operation policies, considering the long existing problems in operation in house renting enterprises, the reform of “power decentralization, management, and service” should be further practiced. Fourthly, the fundamental public service for tenants should be guaranteed. According to the Several Opinions on Accelerating the Foster and Development of House Rental Market by the General Office of the State Council, tenants without local registered permanent residence can apply for residence permit based on the Interim Regulation on Residence Permit and other related regulations so that they can enjoy their rights in compulsory education, medication and other basic public services of the state, which should be implemented fully in all areas. Fifthly, reduction of taxation. The Central Government of China released a unified standard for related taxation: to private property house renting, the percentage charge is reduced from 5% to 1.5% for charge of value-added tax; to private property house renting that the monthly rent is below 30 thousand yuan, the charge of value-added tax can be exempted by the end of 2017; to the agency service on house renting provided by real estate agencies, the tax rate for charge of value-added tax would be at 6%; and to personal income gained from house renting, the charge of individual income tax will be cut down by half.
At present, the Ministry of Housing and Urban-Rural Development and other related departments have chosen 12 cities, namely, Guangzhou, Shenzhen, Nanjing, Hangzhou, Xiamen, Wuhan, Chengdu, Shenyang, Hefei, Zhengzhou, Foshan, and Zhaoqing, as the first bunch of cities for experiment of the house renting reform.