XINHUA

 Before you buy

According to China's regulations, foreigners who have spent at least one year in the country either for studying or for working are eligible to buy property in China. Furthermore, foreigners are only allowed to purchase property for their own personal use. If you want to rent properties or to use them for commercial reasons, you'll have to do it in the name of a Chinese corporation either as a wholly foreign-owned enterprise or a joint venture established for this purpose.

It's strongly advised to seek the assistance of a real estate agent or a specialized lawyer in the area where you intend to buy a property since different cities implement the policy differently. Big cities like Beijing, Shanghai and Shenzhen are popular choices regarding locations, while second-tier cities like Xiamen, Qingdao and Hangzhou also enjoy a very good investment climate and will bring significant value.

If you set your heart on a new place, you should insist that the developers show you the building permits, documents and land use certificates before signing a contract. If you want to buy a second-hand property, make sure the seller is the actual owner. Also check if the property has any third party rights like mortgage or other encumbrances. If so, the property may not be transferred.

In either case, be sure to do some research on the property management company. They're responsible for keeping the place livable, secure and clean but their services can vary greatly. If you're buying off-plan property, visit them to discuss about their services. If the property has already been completed, ask for the opinions of people living in the compound.

The buying process

The purchasing procedure is basically the same as for domestic residents, which includes: The buyer and seller sign a purchase contract; apply for mortgage from a commercial bank (if applicable); buyer and seller pay relevant taxes; and apply for title deed from title transfer office. However, some special procedures may apply to foreigners. For instance, (1) in the event of buying first-hand property, a certification from local exit-entry administration of public security bureau certifying that you has lived in China for more than one year is required; (2) shall prepare two notarized documents: passport notarization and Chinese name notarization (to be used for title deed); (3) if you entrust other person to conduct the transaction on your behalf, the power of attorney must be notarized as well.

How to get a mortgage?

Some Chinese commercial banks provide mortgage loans to foreigners in RMB or in foreign exchange. If you are financing through a Chinese bank, then check their particular requirements on income, down payment, and loan amount. If you are exchanging your foreign currency, an individual can exchange up to $50,000 annually. More than that requires government approval. Documents generally required by banks for mortgage include, but not limited to: notarized ID document, income and financial resources certificate, purchase contract, down payment certificate, detail list of mortgaged or pledged property and its title or ownership certificate.

Points to remember

● You do not own the land your property resides on. Instead, it's on lease from the Chinese Government

● Owning a property in China does not automatically grant you the right to reside in the country

● Don't hesitate to negotiate the real estate agent commission. You can also pay it in installments

● The architectural space is different from the useable space

● If you decide to sell your property, you'll have to pay income tax in China