x Abu Dhabi, UAETuesday 25 July 2017

Home prices ruin dreams of marriage for young Chinese

"When a man in China needs to get a decent date he needs to have an apartment," a housing expert says, but high prices are ruining that dream for young Chinese.

The average cost of a flat in the area of Beijing where Li Yanchen works at a travel agency is equivalent to 100 years of his earnings.
The average cost of a flat in the area of Beijing where Li Yanchen works at a travel agency is equivalent to 100 years of his earnings.

BEIJING // With property prices increasing and his salary modest, Li Yanchen admits his chance of buying an apartment without help from his parents is limited.

The 27-year-old travel agent and his girlfriend, Zhao Zhenni, 26, a school administrator, would have liked to have married and moved into their own place by now.

Instead they continue to live with their respective parents, one among the thousands of couples in China thought to have put off their nuptials because of rampant house-price rises.

"It's too expensive," said Mr Li, who makes about 5,000 yuan (Dh2,877) a month during the busy summer period, and only around one third of that in the winter.

"This happens around us - young people delaying getting married. It's already a little late for me to get married. If I had a flat of my own I would get married as soon as I could. I would have got married already."

In China, a young man may struggle to find a wife unless he has property to offer. It is something that is "deeply ingrained in the culture", according to Stephen Jaske, the director of the Economist Intelligence Unit's China Regional Forecasting Service,which tracks property prices.

"You cannot get married without an apartment. When a man in China needs to get a decent date he needs to have an apartment," he said.

Similar problems are found in many parts of the Arab world, particularly countries where stagnant economic growth has hampered employment creation. Many young men, in societies where the number of people reaching adulthood has grown rapidly, have struggled to find well-paying work, preventing them from accumulating the capital required to marry.

According to Zhang Di, an estate agent in the part of east Beijing where Mr Li works, apartment prices in the area average about 3.5 million yuan (Dh2m), or around as much as the travel agent would earn, at his current wage, in a century.

"People come to ask the price of the flats, and almost all of them complain they are too much," Mr Zhang said.

Property prices in China tripled between 2005 and 2009, driven up by the lack of alternative investment avenues for Chinese people.

Over the past year-and-a-half the authorities have introduced a series of measures to try to curb housing price increases, including restrictions on the purchase of second homes, higher interest rates on mortgages, a property tax and curbs on lending.

House price inflation has levelled off slightly. In the 12 months up to mid-2010, prices rose 11.4 per cent, while over the following year they had gone up only a further 4.2 per cent. Yet a slowdown in increases is of little comfort when prices are already way out of reach.

"It's very hard to find young people who can buy a flat directly. Most people buying are aged 50 or 60," added Mr Zhang.

The Chinese authorities have tried to encourage the building of affordable housing but their initiatives have met with limited success. Last year, the government set a target of 5.9m units to be built nationwide, but 3.6m were constructed.

According to Yip Ngaiming, an associate professor in the Department of Public and Social Administration at the City University of Hong Kong who specialises in housing policy, local authorities have been reluctant to invest in social housing.

"For local governments, selling land is a major source of revenue. If they set aside land for low-cost housing, that's one less piece of land to sell," he said.

In any case, he said the social housing being built by the authorities was primarily aimed at low-income families rather than young couples or single people. Mr Yip said he was "pessimistic" that housing would become more affordable in mainland China.

"The prices are not easy to contain in the next few years," he said, citing the number of new households and the continued lack of alternative investment opportunities, as reasons why prices would remain high.

For the likes of Mr Li, the travel agent, the only way he will be able to afford an apartment is with help from his parents, something he hopes to get over the next year or two.

"I don't have enough money to afford a flat [without assistance]," he said.

Others, such as Zhou Xupin, 24, who works in the kitchen of a restaurant in east Beijing, do not see a scenario that will enable them to buy their own place.

When he marries, Mr Zhou plans to return to his home province of Sichuan in south-west China and live with his parents.

"It's OK to share with them as they live in a village and they have more space than in the city," he said.

 

dbardsley@thenational.ae