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Guangzhou, Shenzhen told to allocate 10% of land for affordable rental homes -Breaking

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© Reuters. FILEPHOTO: After the new coronavirus disease, COVID-19, spread in Guangdong province (China), May 17, 2020, a woman with a mask walks past Shenzhen residential buildings. REUTERS/Martin Pollard

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BEIJING (Reuters), – China’s populous province Guangdong announced Friday that Guangzhou, Shenzhen and Guangzhou must allot at least 10% of their land to housing rental. This is in response to rising property demand especially for the younger generation.

The new regulations for rental housing would require that homes not larger than 70 square meters in size be built. This will allow young residents to live there. The Guangdong government stated in a document that they must pay rents less than other property owners in the area.

Guangdong’s population has increased to 126 millions over the past decade as technology giants like Huawei and Tencent, based in southern China, attract workers from other parts of the country looking for well-paying positions.

Guangdong has seen new property prices rise in tandem with growing populations and economies. This is putting downward pressure on the lower-income group, which includes fresh graduates earning entry-level wages.

Guangdong stated in August it plans to build 740,500 rental units between 2021-2025 and 222,000 this year.

Guangzhou will host Shenzhen as well, while rental housing projects in major Pearl River Delta towns like Zhuhai (Foshan), Dongguan, Zhongshan and Zhongshan will also be the focus.

In October, Shenzhen’s Silicon Valley saw new home prices average 55,000 Yuan per square metre. This was the highest price among 100 cities monitored by China Index Academy. It is one of China’s most respected independent research companies in real estate.

Beijing has made the plight and struggles of those with low incomes a central part of its policymaking, thanks to President Xi Jinping’s promise to close social gaps to realize so-called common prosperity.

China said in September that the annual increase in rent for a house in cities shouldn’t exceed 5%.

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