Rents are falling in Shanghai, with some landlords offering discounts of up to 20%, as expatriate residents and high-income earners leave due to zero-Covid controls in China’s commercial hub. Shanghai’s average monthly home rent fell 5.6% in September to CNY102.71 per square meter, from August, according to creprice.cn, a real estate industry data provider. Average charges may fall another 1% to CNY101.59 based on quotations of 52,600 flats available for lease. “Homeowners are disappointed” with the sagging housing demand, said You Liangzhou, the owner of the Baonuo real estate agency in Shanghai.
“High-end homes cannot find tenants unless the landlords agree to cut the rates by at least 20%.” The decline in the secondary housing market exacerbates the crisis in China’s slumping property market, where sales have slowed to a trickle, stifled by the potent combination of a slowing economy and an ongoing mortgage boycott by borrowers, which have left tens of thousands of unfinished homes standing idle.
A three-bedroom apartment in downtown Shanghai would be available for a monthly rent of about CNY20,000 in June, when Shanghai authorities lifted a two-month citywide lockdown. Four months later, the same flat could be rented for CNY15,000, as vacancies have jumped across the city amid an exodus of residents anxious to avoid being caught up again in the zero-Covid drive. Local health officials have found more than 540 infections in Shanghai since October 1, prompting them to lock down tens of thousands of residents in more than 20 residential areas for seven days. Shanghai’s anti-Covid measures have upended the city’s economy, disrupting everything from multinational manufacturers such as Tesla to corner shops and cafés. American companies in Shanghai said they are more pessimistic than ever before. Shanghai issued more than 215,000 working permits for foreign professionals in 2020, accounting for one-fourth of the total number of foreign employees nationwide. No up-to-date official figures are available to show how many foreigners have left the city this year, the South China Morning Post reports.
