All of us living in Beijing know our landlords have been salivating for months over the windfall they just know they’re going to make by jacking up rents through the roof. Some were planning to rent out their not-so-special places for $40,000 (USD) just for the month of August. My own evil landlord told me he was inflating my already high rent by nearly 50 percent when my lease expires in July.
So I’ve been watching the apartment market in Beijing carefully for the past three months, and one thing I can say with a fair degree of certainty: there is a significant apartment glut in Beijing and many of the greedy landlords (like my own) who rejected very reasonable offers because they had RMB signs in their eyes are going to be badly fucked, and they deserve to be fucked.
I’ve been watching Beijing apartments on Craigslist, for example, and in just the past two weeks there’s been something akin to a meltdown. Prices at Fortune Plaza and Central Park and Sun City and the likes have dropped dramatically. By waiting this long, 30 days before my lease expires, I was able to land a pretty good deal in a popular Dongzhimen complex, with 30 percent more floor space than my current apartment at just a slightly higher rent. And it’s a better location (I am so tired of living in the CBD). I move in on July 19. My current landlord, who insisted he could rent the place out for an obscene price, is going to be screwed. As of the past week, there are now many apartments the same size in the same building on the market for way less. The bubble is finally bursting. And with my not moving out until July 19, he’ll have a hard time getting it marketed and made ready for the next tenant in time for August. I always paid my rent early and offered him a very fair compromise. But no, he wanted the sun and the moon and the stars. As the old saying goes, pigs get slaughtered.
Rents here are still high, especially when you think of what they were just two years ago. But a lot of landlords were fantasizing, and the reality is just dawning on them. Instead of wallowing in cash, they’re going to have to hustle just to get someone to move in at all. Well, they brought this on themselves, and I won’t shed any tears for them.
Beijing is now so insanely over-built, I think after the Games it will once again be a buyer’s market for years to come.
Richard Burger is the author of Behind the Red Door: Sex in China, an exploration of China's sexual revolution and its clash with traditional Chinese values.