How to Buy Land in China

Posted by Frank Gogol

Investing money in property is one of the oldest methods known to man used to grow wealth. Most investors all across the globe have some form of real estate investment. Buying land still hasn’t gone out of fashion and the opportunities may even be increasing in certain countries.

So what about Asian markets? Are there property investment opportunities there? Investors who fit the requirements can buy land in China. Even certain foreign nationals can buy property in China. But how does it work and what should you expect if you want to invest in Chinese property? Let’s take a look.

Can Chinese Nationals in the U.S. Buy Land in China?

There are millions of Chinese nationals living, working, or studying in the U.S. and they have been known to make significant property investments here. But can you buy land in China if you are still living in the U.S.?

If you are a Chinese national, you can buy land in China without having to fulfill other requirements like proving a sustained period of residence in China. You are a Chinese citizen and are eligible to buy land based on your nationality. You’ll just have to find the appropriate ways to send money back home to complete these transactions. There are some handy remittance services that could help with that.

Before we go any further we need to know an important thing about property law in China. All land in China either belongs to the government or to collective ownership groups. It is legal if the government expropriates land according to the constitution whenever it matches the reasons for land expropriation. Owners will, however, be duly compensated.

So now we know that Chinese citizens are eligible to buy land, but what about foreign nationals who want to buy land in China? Let’s have a look.

Who Cannot Buy Land in China?

The Chinese government does not allow the sale of the property to foreign nationals who have not spent time in China. Foreign nationals living and working abroad may, therefore, not buy land in China. You need to fulfill certain requirements before you are eligible to own property rights in China.

The Chinese government also does not allow property ownership for investment by either foreign companies or individuals. They also don’t allow foreigners to be landlords. So, you can’t rent your Chinese property to someone else.

Who Can Buy Land in China?

We’ve established now that Chinese nationals may buy land in China. But so too foreigners who have spent more than a year in China either working or studying are allowed to buy land in China. You’ll need to go through a supervision period before you are allowed to buy grants to property, however, and thereafter you may only buy in specific prescribed areas.

It is important to note that Foreigners also don’t actually own the land, they get a grant to use the land for a specific time period predetermined by the government as stated in the contract between the buyer and the seller.

Chinese Property Prices

The Chinese housing market has seen a surge in the prices of residential property in the past few years. It is partially because of the government’s pressure on banks to increase lending (to stimulate the economy). So now more people in China are borrowing money to buy homes. The increase in the demand for homes has, in turn, caused a sharp rise in the prices of property.

Economists think the Chinese housing market may act like a bubble and actually cause harm to the Chinese economy if not kept intact. So, the government has implemented measures to lower the effect of the surge in housing prices. They implemented two main measures to slow down the effect of the increased borrowing:

  1. They impose large down payments which are deposits required before you may get a home loan.
  2. They also limit the number of new homes people may buy through a home loan.

Certain cities like Shanghai have seen real estate prices rise to between $16,000 and $18,000 per square meter. This has caused people to look for homes in places that are less densely populated.

How to Buy Land in China

There are two kinds of property titles in China namely use rights and freehold. You should get a local property solicitor to help you in your search as you buy land in China. They will help you understand how things work and will also warn you about potential threats like hidden costs. We can help you with the basic steps, however.

Here are the basic steps to buying land in China.

1. Get a Real Estate Agent

You might know where to find the best Chinese supermarkets in the U.S., but do you know the best property offers in China? You aren’t legally required to have a real estate agent, but it places you at an advantage to have someone on your side who speaks the local language. Agents can also notify you about great deals and healthy opportunities that pop up.

2. Submit an Offer and Pay the Deposit

After you’ve found a suitable home you need to submit an offer. The seller needs to accept the offer before you can proceed. Once they have accepted you must pay a deposit of 1% of the total value of the offer to show your intent to conclude the transaction.

3. Sales & Purchasing Agreement

The Sales & Purchasing Agreement (SPA) is a document required to facilitate the transaction. It holds the following details about the transaction:

  • Selling price
  • Taxes and fees pertaining to the transaction
  • Payment terms or installments
  • Clauses containing the proceedings if one of the parties can not honor the contract
  • Any other details required by either party

Contract Registration

Your contract now needs to be registered at the correct police station. Find a mandarin speaking friend you can trust (an estate agent can also help here) to help register the contract at the local police station. It is important to go to the police station that holds jurisdiction over the area where your property is situated.

New Contract Signing with Government Official

The transaction must be recognized by the government as well. So the contract must then be signed by a government official to serve as a witness.

Title Deed Transferral

Complete the above-mentioned steps and then continue to transfer the title deed from the seller to the buyer. Different processes apply to make sure that no liabilities like mortgages or encumbrances are passed on to the new owner. The title is transferred at a property exchange center called the Deed and Title Transferring Office. Once again visit the local center in the area where you are purchasing the property to get this done.

Receive Your Contract Number

Your agent needs to submit the contract online. Thereafter you can get your contract number proving the validity of the transaction. This is the only way you can get a bona fide certificate of ownership.

Property Sales Taxes and Fees

The property sellers in China are required to produce certain documents that facilitate the property sale transaction. Throughout these processes, there are also different kinds of fees and taxes you will need to pay.

Here is a list of the most common ones required in the average property sale:

  • Transfer tax – 3-5% dependent on the commission paid to the real estate agent and the location of the property.
  • Stamp duty – 0,05% of the total value which is relatively low when compared to other Asian countries.
  • Real estate commissions – this is usually between 1-3%.
  • Land use tax – These are rates applicable to people who lease land. It depends on the area but people in Shanghai could expect to pay around 1.5 to 30 Chinese Yuan per square meter. This tax is payable annually.
  • Capital gains tax – 5% if you own property for fewer than 5 years.
  • Property tax – Is not required for most parts of China but only a few pilot projects in Shanghai.

How to Get a Personal Loan to Buy Land in China

Property in China could be a great investment. Or perhaps you are a Chinese national living in the U.S. but you want to buy the property back home. What can you do if you don’t have the funds available to execute on your decision? You can take out a personal loan!

Stilt offers personal loans to eligible candidates. Simply check whether you comply with the basic eligibility criteria and apply online. Even foreign nationals can apply for a personal loan with Stilt.

You can get a loan for up to $25,000 starting at an APR of 7.99%. This is how it works.

1. Submit an Application

Apply online for the loan amount you need. Submit the required documentation and remember that the best applications get the best loan offers.

2. Receive an Offer

Stilt will contact you within 24 hours of your application. Please supply any additional information if required. Soon you will get your personal loan offer and a promissory note. Please sign and return that note if you want to accept the loan.

3. Start Making Payments

The loan will be disbursed into your U.S. bank account within 2-3 business days. Choose your repayment option online. Selecting an autopay method will help you to pay on time every month.

It is that simple. And best of all, Stilt even supplies loans for Chinese students as well.

Personal Loans
 for Non-U.S. Citizens!

Check Loan Options

Loans for up to $35,000. No cosigner required. No prepayment penalty.


The Chinese housing market has seen a massive surge in prices over the past year. You can also own land in China and make use of this great investment opportunity. If you don’t have the funds available just yet, don’t worry! You can use a Stilt personal loan to buy land in China. Apply today and get the property you need.

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