The Unbearable Cost of Renting in Beijing

By Yvonne Kennedy

It was the fifteenth apartment I had seen in two days of househunting in Beijing, and all the places were starting to look the same.

Except for this apartment. It was a four-bedroom, 3,000 square-foot pad in a new high-rise building that wouldn't have been out of place on Manhattan's Upper East Side. There were beautiful hardwood floors, granite countertops in the kitchen, a Jacuzzi in the master bedroom. And it was fully-furnished with top of the line European appliances.

Still, it wasn't that much more plush than the other apartments we had seen. What stood out were two things. First, this apartment came with six televisions, each with satellite programming and fitted with a DVD player.

"Could we get another TV in here?" my husband Alan asks, his gentle Irish irony lost in the translation. The building manager nods back at us blankly, as though this was not an unreasonable request.

The second shock was the price. All of this Beijing luxury, our real estate agent Jane informs us, can be ours for just "8,000 US dollars a month."

Now, Alan and I are more than your average jaded renters. We've lived in pricey Asian metropolises like Taipei and Seoul. And we had the good timing to move to Silicon Valley just as the dot-com boom began - and endured escalating rents as a result. But that price still made us balk.

Home to ten million residents, Beijing has been in the midst of a real estate boom for nearly two decades, with spiraling prices amidst rampant construction of high-rise office towers and apartment blocks. The influx of job-seeking locals and business-dealing foreigners has kept demand for housing hot. Though the real estate market cooled briefly in the early 1990s, the city's successful bid for the 2008 Summer Olympics and China's entry into the World Trade Organization will guarantee the acceleration of newcomers and add to the housing crunch. That spells trouble for the average local Beijing resident. Many local residents have seen their standard of living increase mightily in the past decade or more. But the average Beijing household earns an income of just US$225 a month, or $2,700 a year.

"TOILET WAS A HOLE IN THE GROUND"

For most foreigners in Beijing, prices have risen even faster, due to the existence of foreign ghettos. Every city has areas where foreigners and expatriates tend to live and play, but Beijing's foreign ghettos are different. As early as the 12th century, Arab traders were forced to live apart from the regular Chinese population. Until the mid-1990s, the Beijing government strictly regulated where foreigners and overseas Chinese could live. It was in the Chaoyang central business district, where the foreign embassies are located, where land has been long been zoned for foreigner-occupied dwellings. Such land costs double as a result.

This legalized segregation can mean the difference between paying 3,000 RMB (about US$375) a month or US$3,000 a month for nearly-identical housing. For foreign students and others who don't enjoy the luxury of a company-granted housing allowance to cushion the blow, the alternative has long been to seek "commodity housing," housing owned by individuals rather than the government. That requires a little bit of bravado and a lot of patience. Even today few Chinese people own their own homes; most live in government-assigned housing in their work units. And even if a foreigner finds commodity housing to rent, to do so legally, they have to get permission from the local police, which was difficult even with the right paperwork.

"You would go to the local police and they would tell you, 'I know you can live here, but if anything happened to you, I would get into trouble, so please find some place else to live," says Jonathan Noble, a Beijing-based manager for the real estate firm, Colliers International.

And living with locals means living like a local. When Sophie Stephanie Roell arrived in Beijing to work in 1995, she found an apartment in commodity housing near Tuan Jie Hu (Unity Lake) on the Third Ring Road, one of the major beltways that circle Beijing. "It was pretty primitive," she recalls. "The toilet was a hole in the ground. I had a camping stove and a little balcony, and absolutely no privacy."

But Roell was only able to live in that apartment for nine months. Despite having registered at the local police, she ran into problems when she tried to renew her visa. "They called in my landlady and rental agent and fined them. I wrote a self-criticism, and was evicted," she says. "I had no place to live."

Roell thinks that her difficulty came because she was a journalist. Even today, journalists and foreign embassy workers are still limited to renting in Chaoyang, according to Noble. However, other foreigners have it much more free. They are even permitted to rent in former work units, not just commodity property. Danielle Gould, a 28-year-old English woman who works for a Chinese environmental organization, lives in a former work unit nearby Beihai Park that she found advertised in a free English-language newspaper.

"At one time this was a work unit for actors and musicians," Gould says. "A few years ago, one of the Chinese residents applied for a foreign musician to come live in the work unit, and now there are three foreign couples here, including us."

Gould had heard the usual warnings from foreign friends about living in Chinese housing: problems with plumbing and electrical wiring, cold concrete floors exacerbated by the lack of central heating. She says her apartment is better than most of the others in her 6-story building, typical of work unit housing. The interior has been refurbished with new tiles, wallpaper and wooden flooring, and is equipped with air conditioning and a washing machine.

Living there has also allowed Gould to break out of the sheltered, privileged existence that too many expats experience. "Every month, one person has to go around to each household and read and record the electric meter," Gould says. "So when it was my turn, I went door-to-door and several people invited me in."

<Next Page>