China has announced discounts on property fees for more than 10 cities, with some reduced to 50% off, and in Liuzhou City, Guangxi, there are neighborhoods offering “zero property fees”. Property fees for residential properties in Chongqing, Wuhan, and other places are also decreasing, with noticeable reductions for some communities after successful applications, sparking attention.
These policies targeting vacant properties have been implemented in Gansu, Lanzhou, Hunan, Changsha, and various other regions, offering discounts ranging from 30% to 50%. Starting from February, cities like Zhenjiang and Jurong in Jiangsu have already implemented favorable property fee policies for vacant properties. According to the regulations, homeowners of properties vacant for over 6 months only need to pay 70% of the property fees in the future.
The number of cities that have announced discounts on property fees for vacant properties has reached over ten. In fact, since February last year, Qingdao in Shandong has been implementing a 40% discount on property fees for vacant properties. Lanzhou in Gansu introduced a policy where property fees for residences vacant for over 6 months are reduced by 50% upon approval.
Not only for vacant properties, but property fees for occupied residences have also decreased. Starting from June 1st last year, the new residential property fee standards in the central urban areas of Chongqing have been implemented. The property fees for elevator buildings are capped at 1.9 yuan per square meter per month, and for stairwell buildings, it’s capped at 1.35 yuan per square meter per month, significantly lower than the market rates.
According to a report by the Shell Research Institute, around 2022, the average residential vacancy rate in 28 major Chinese cities reached 12%. Based on international standards, a vacancy rate below 10% is considered reasonable.
The recent trend of lowering property fees by various cities is driven by concerns about empty properties and excessive property management companies caused by the past three decades of rapid real estate expansion.
For instance, it was reported that in recent years, numerous communities in Wuhan have witnessed a decrease in property fees as property management companies lower their rates to attract renewals. In areas like Jiangxia and Xinzhou, even central urban areas have joined the price reduction trend.
The situation is not uniform across all cities, with Shanghai, Beijing, and Shenzhen not implementing discounts on property fees for vacant houses and still requiring full payments. Only Guangzhou offers certain property fee discounts for vacant public housing.
In upscale Shanghai neighborhoods, such as the Huaguo Family Guobei Garden in Changning District, where the unit price exceeds 100,000 yuan, the property service fees have been increased from 2.20 yuan per square meter per month to 5.95 yuan per square meter per month over time, while the average property fees in Huangpu, Jing’an, and Yangpu districts have already reached 17.56 yuan per square meter per month, 12.06 yuan per square meter per month, and 9.92 yuan per square meter per month respectively.
Despite the reductions in property fees, deeper underlying issues remain unresolved. There is a lack of transparency in accounting, setbacks in managing community agendas without a committee, and questions about funding for future maintenance needs as building structures age.
The lowered property fees may ease the burden on homeowners, but the long-term sustainability of these policies and their impact on the real estate market remain uncertain.