Buying In China Shenyang

F

faolteam

Registered User
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any advice on buying in China,

a friend of mine who is chinese is buying one and asked me if i was interested 120 sq at €46.000 euro and im still considering it
 
1. You will not own the property (you will not have title deed to it).
2. Have you ever been to China (never mind having seen the apartment)?
 
can u elaborate on what u mean : You will not own the property (you will not have title deed to it). i own property in Spain and i dont have the deed the bank does ????

I have never been to china its purely an investment infact i wont even rent it i will just lock it up till i seel in in a few years

i know my chinese friend for the last 10 years he has lived and worked with me etc
 
Isn't this a country where the government bulldozes people's houses to build new houses. Maybe they'll do the same to the new houses in 20 years. Seriously-how are property ownership rights over there these days?

46k seems a lot to me? what sort of rents can be had-I presume chinese wages are sufficiently low that you'd need a foreign tenant to make a decent yield?

If you do decide to proceed then make sure you do it independently of your mate. People who were friends have ripped each other off for a lot less and 46k is a lot of money in China.
 
From last year, but has the salient points in it:
http://seekingalpha.com/article/9073-dreams-built-on-sand-investing-in-china-real-estate

If you are 'willing' enough to buy somewhere that you have never seen, then I can only hope that you get lucky with the location and that it is not next to a chemical factory, meat market, or sewerage plant; that you get lucky in your hope of capital appreciation (it is only a hope as you have not done any research); that you get lucky in the fact that the apartment might actually be completed and you might actually own it if the law in China changes.

That's a lot of luck. Did I use three lucks there or four? Do you know, in all the excitement of writing this, I kind of lost count myself. So, do you feel that lucky?
 
I'd agree with Murphaph.

In a second tier city like Shenyang, location would be crucial, somewhere downtown near the Marriott, Sheraton and sports stadium.

I'd say you'd get a better return in a Shanghai satellite city like Nanjing or Wuxi.
 
Deirdra said:
I'd agree with Murphaph.

In a second tier city like Shenyang, location would be crucial, somewhere downtown near the Marriott, Sheraton and sports stadium.

I'd say you'd get a better return in a Shanghai satellite city like Nanjing or Wuxi.
Click to expand...

There is no freehold in China. Shanghai has a glut of apartments that are lying empty. My brother lives in the Mantoa district which is as central as you can get and of 300 high spec apartments, he reckons 270 are vacant. Although property prices fell by 10-15% about 18 months ago , they have rebounded this year and are up 9% (June to June) with Shenyang being one of the fastest to rise see http://www.chinadaily.com.cn/bizchina/2007-09/12/content_6101653.htm. Shenyang is a bit close to North Korea for my comfort about 250 miles to be exact. The Chinese system is capitalism on acid and I reckon the system will be in deep trouble when their stock index collaspes, its P/E makes the dot.com frenzy look sane with over 300,000 new day traders registering every week.

However Freehold is everything and I would not trust their government, as mentioned those in Beijing who were bulldozed out of their homes to build hotels for the Olympic Games got $10 compensation. They distrust outsiders more than their own so there would be no preferential rights.

You may make money but it is a big risk, there are easier ways to play this success story without full risk exposure. Finally you are getting 120 sq for €46k - I take it this is in sq metres not sq feet ?(You'd be surprised in Tokyo size of dwellings).
 
AFAIR, within the last year or so, the Chinese authorities passed a law preventing foreign nationals from purchasing property.

It may be possible to purchase through setting up a chinese company or similar. No idea how easy this is to set up or if it's even feasible. Search previous threads in this forum. There are bound to be more details there
 

Persius,

I forgot about this. You must be resident for more than one year and the maximum anyone can purchase is one per person. Tax is also higher on foreigners (I think). However local governments haven't followed through completely on the central government's ruling (July 2006). Taiwan and Hong Kong residents had been purchasing en-masse beforehand and since the ruling. You can be sure there is loads of corruption - make Spain look fully kosher. There is fear amongst many financial journalists that the governemt could take back illegal properties into state control, without any compensation or right to any appeal.
 
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