2017-04-18 16:33:21 Editorial
A recent HSBC survey reveals that 70% of millennials in China are homeowners, based on a survey interviewing around 9000 people from 9 countries aged 19-36. This is an overwhelmingly high percentage compared to figures from the United States and the United Kingdom, 35% and 31% respectively.
The world's largest commercial real estate services and investment firm CB Richard Ellis released a research report Millennials: Shaping the Future of Real Estate "in 2016. It highlighted that in China, 57% of respondents planned to purchase a house in the future - the highest figure in Asia. Further, that the “post 80s” and the “post 90s” generations as a consumer group are driving the development of the real estate market forward.
One of the key reasons for this trend is the cultural importance placed on home ownership. Millennials face pressure from their parents and peers, and over 40% of young people have financial support from family in making their first down payment. In first-tier cities, Beijing, Shanghai and Guangzhou where the pressure to purchase is greater, there is a higher percentage of home owners. Another survey conducted in Nanjing showed that 75% of young people in the city tend to purchase houses before they reach 30.
Purchasing a house is viewed as a form of investment. 27 year-old Volare Ye and his wife own a house in Guangdong and are looking to buy their next. Ye believes that real estate is a fixed asset, which is more stable than stocks and other investments. “The middle class youth will invest in real estate once they start saving. They don’t really have other options to maintain the value of their assets,” he says.
According to a second-hand housing transaction platform data released in December 2016, the average second-hand housing price in Shenzhen, Beijing, and Shanghai was 47,300, 59,200, 53,200 yuan/square meters respectively, higher than Tokyo. What’s more, the price in some areas in Beijing had surpassed Manhattan in New York.
My mother-in-law wants me to buy a house
In reaction to the pressure of buying a house, in February a song called “My mother-in-law wants me to buy a house” started trending online. The launch of the song coincided with the rising housing prices in first-tier cities in the same period. It ridiculed the mounting pressure and jokily proposing that a solution can be found by asking a magic mirror. When interviewing the band members from the Akatism A cappella in Shanghai, China Youth Daily found that 2 of 9 members had purchased houses “with the arrangement of their parents”. But the majority of the band members who are from the “post 85s” and the “post 90s” generation aren’t concerned with owning property.
On the contrary, in China, there are people who have gone against the trend of purchasing property. "I don't know what the young people in Shanghai think, but I think the burden is too heavy." Zhan Zixian, a member of the group from Taiwan, who prefers house renting, “So I can live and work in wherever I want. Life shouldn’t be restrained by a house."