Quick Take: China to Roll Out First-Ever Nationwide Regulations for Rental Housing Market

The Chinese government is accelerating efforts to boost the rental housing market by introducing new rules for residential property management companies, official media said.

The proposed regulations — the first-ever nationwide guidelines for China’s huge rental industry — aim to strengthen the market’s development and encouraging investment.

A team of officials from the State Council and the Ministry of Housing and Urban-Rural Development has been sent to cities around the country to solicit local input and advice on the proposed rules, according to the Economic Information Daily, a unit of the state-run Xinhua News Agency.

A timetable for enacting the regulations has not been announced.

The regulations will address various industry issues, covering areas such rental housing platform development and supervision, standards for rental housing construction and interior fixtures, and rental fees, the report said. The rules will also spell out terms for government financing and tax support for property management firms.

Last year the State Council, China’s cabinet, ordered local governments to counteract the effect of surging real estate prices and meet rising demand for urban housing by doing more to promote the rental housing market. Many cities, including the southern metropolises of Guangzhou and Shenzhen, have responded by mapping out plans to boost local markets.

News of the latest government effort apparently turned investors bullish toward property management company stocks on Tuesday.

As of noon Tuesday, shares in three companies had already risen to the daily upward limit, including Shenzhen-listed Worldunion Property, whose shares climbed 10.2% in the morning session to 11.97 yuan ($1.82); and Shenzhen-listed Kunming Sinobright Group, which jumped 10.04% to 12.28 yuan.

Contact reporter Pan Che (chepan@caixin.com)