Guangzhou rental housing scheme gets fresh impetus

State-owned Yuexiu Group and Pearl River Enterprise Group unveiled their subsidiaries for the rental housing business in Guangzhou on Thursday, with local branches of Industrial and Commercial Bank of China and China Construction Bank pledging at least 1 trillion yuan ($151 billion) in financial support during the coming five years.

Yuexiu Group owns businesses in the investment, property development and management sectors as well as financial service, and this advantage will drive the company's long-term rental apartment business, said group Chairman Zhang Zhaoxing. The group's Hong Kong-listed unit Yuexiu Property Co holds shares of Hong Kong-listed Yuexiu Real Estate Investment Trust.

Pearl River Enterprise Group has been engaged in the construction of government subsidized housing projects since 2011 and will play a role in the investment, construction and management in this sector, said its Chairman Zheng Shuping.

The move marks a step forward in the efforts of the Guangzhou authorities to develop the local rental housing market, with the city listed as one of 12 in a pilot program launched by the central government for expanding the rental housing market.

The city government issued a 16-measure program in July, including a pledge for equal rights to social services for both house buyers and renters.

It launched a rental housing information platform last month, with more than 100,000 rental housing units already available on it. Guangzhou stands as a huge rental housing market, with more than 3.6 million rental housing units available, said Yang Weilong, director of Guangzhou Real Estate Rental Administration Office.

An association of companies engaged in rental housing was established in the city last month and signed a framework agreement with China Hospitality Association for supplying management talent to the sector.

The central authorities have reiterated on many occasions that "housing is for living in, not speculation".

The development of the rental housing market and increased supply of rental housing are important measures in adjusting the property market in the long run, said Wang Hongwei, director of Guangzhou Housing and Urban-Rural Construction Committee.

A better rental housing market provides the key for Guangzhou to stand out in the future by attracting high-caliber talent, said Zhou Jun, deputy president of Guangdong provincial branch of ICBC.