View of Shenzhen city from the border of Hong Kong.
The rental market in Shenzhen has been in a continuous downturn since 2020, with fewer tenants and landlords still having difficulty closing deals despite repeated rent reductions. Shenzhen rents have fallen to the level of 2018.
A real estate agent told mainland media that he has been a real estate agent in Shenzhen for eight years and has rarely seen such a downturn in rentals, “before it was ‘people looking for houses’, now it is ‘houses looking for people’. “
The mainland’s “Times” on January 18 cited data from Shenzhen’s Centaline Research Center, showing that the overall supply in Shenzhen’s rental market in 2020 exceeded demand, with the city’s average monthly rent falling by 5.3% to 73.7 yuan per square meter (RMB, same below) as of December.
Tenants: rent fell back to three years ago
One tenant told the Times that he is ready to rent a new room from the city as there are now more choices of properties and more room for bargaining.
He said, for example, that the monthly rent for a one-bedroom apartment in the Star River Legend neighborhood in Longhua District, which was first listed for rent in September 2020 at 5,500 yuan, had been reduced six times to 4,200 yuan by the beginning of January this year, but as of Jan. 15 there was still no deal.
Another tenant, who is currently living in Strawberry Apartment in Bao’an Golden Land, revealed that all listings are now dropping their rents and have fallen back to three years ago.
The monthly rent of his studio apartment was RMB 1,400 in April 2018 and rose to RMB 1,600 in 2019, but in April 2020 the apartment offered a “15% discount for one year lease renewal”. When he asked for the price again on January 13 this year, he was told that the monthly rent for the same apartment was only $1,200, and that he could get a discount if he referred a friend.
Owner: Redecoration and price reduction
A landlord in Shenzhen’s Luohu District’s Dongmen Street is renting out the property. Her original tenant rent was RMB 2,450. After she moved out in November 2020, she lowered the monthly rent to RMB 2,200 and rented it out through several channels, including Chain Home, Q Housing, Shenzhen Rentals, Douban Rentals Group and Xiangyu.
“For a whole month, only three agents called to say they had tenants to look at, two said they were thinking about it, and one just didn’t show up.” She said. What she didn’t expect was that she rented it out in 2018 in just one week, and now she can’t even rent it out at a reduced price.
In this case, the agent suggested in late December 2020 that she redecorate and add furniture and appliances, and then lower the monthly rent to $2,000. The property eventually closed. She said that although reluctantly, she had to do it in order to rent it out quickly, and that the market might still be poor in 2021.
“I don’t know when the epidemic will pass. Even if (the epidemic) passes, the rental market will take a while to slow down. It’s impossible to go back to pre-epidemic (rents) in the short term.” She said, “It’s not a small burden for landlords to have the same mortgage and lower rents.”
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