Property Rights

In Shanghai, there are two types of ownership rights: user rights (shi yong quan) and freehold rights (chang quan). The former grants rights to use the land and the latter offers rights to the property. Foreigners are not allowed to purchase user rights. Freehold rights are for a period of 70 years, at the end of which the owner may pay a tax to extend the period. The details of this policy have yet to be set forth by the government, but real estate experts predict a small, one-time tax will be sufficient to extend the period. Only a potential buyer of a garden home should be concerned about the amount of years left on a property, since the land tax for these properties may be quite steep (up to ¥3,000 per square metre).­­­­

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