For Foreign Investors
New issue:
According to the new regulation, the foreigner (except the Hongkongnise, Taiwannise, Macaunise ) could only purchase the property in Beijing if the stay in period in China is over one year. The foreigner, Hongkongnise, Macaunise only can purchase one property. Before purchase, the buyer needs to do the application at the Beijing Public Security Bureau Exit-Entry Administration Bureau and sign the Self- Use only confirmation letter. The property bureau could only accept the title transfer application after the buyer obtaining the approval from the Beijing Public Security Bureau Exit-Entry Administration Bureau.（This regulation will be suspended from January 1st to December 31st, 2009.）
Following please see some information related to an investment in Beijing for your reference.
For a foreigner to purchase a new property or a second hand property in Beijing, the regulation and tax are the same as the Chinese purchaser. The foreign purchaser needs to do one Chinese name notarization and passport translation notarization. The cost is around RMB500. It is better to have several copies for future usage. One additional copy is RMB10. The name on your property license shall have your passport name and your Chinese name.
The purchasing procedures for the new property（WGD’s professionals shall assist you do the purchase before, during and after the property title transfer）:
1) Advised by your investment agents-WGD Real Estate to selecting the valuable properties.
2) Select the right properties.
3）Pay a visit.
4) Negotiation the prices and payment issues.
5) Study the Sale and Purchase Contract.
6) Consult the appointed lawyer for the safe title transaction.
7) Sign the format sale and purchase contract through the real estate bureau.
8）Do the payment according to the signed Sale and Purchase Contract.
9) Hand over the property to the purchase.
10) Obtain the Property license and the Land License.
To purchase a new property, the related fees and taxes are:
Land tax (For Apts): 3% of the purchasing price (RMB 9,300/sqm up),1% of the purchasing price (RMB 9,300/sqm under, the property’s size has to be under 147sqm.)
Land Tax (For Villas): 3% of the purchasing price.
Maintenance fee: RMB 200/sqm for the apts which is high rise ( more than 6 floors high), RMB 100/sqm for the low rise apts and the villas.
Lawyer fee: Around 0.2% to 0.3% of the purchasing price.
Agent fee:1% of the purchasing price
If taking a mortgage:
Registration fee: around 0% to 1% of the loan amount.
You could get a 60% to 70% mortgage at the foreign bank (USD loan or RMB loan) or some Chinese bank (USD loan or RMB loan). Different properties they offer different appointed bank mortgage service.
The most of the new properties are for sale before built (we call it Qi Fang). The seller shall provide the sample units, layout map, some with the video, to give you the necessary information. There are also some newly built properties for sale by the developer, but the good units are much more expensive compare with the earlier purchase.
The payment for both new property and second hand property purchase can transfer from your overseas account to your individual account in Beijing. For exchange the foreign currency into RMB currency. The purchase shall provide the following documents in original copies (The signed purchasing contract, the Purchaser’s passport, the seller’s bank information). If the total purchasing amount is under one million US Dollar, the bank can accept your application by itself and approved within one day. If the amount is over one million US Dollar, the bank shall request you to do the application for currency exchange at the Foreign Exchange Bureau (“Wai Hui Ju”). They required the same documents mentioned above. After the approval, the bank shall change the foreign currency into RMB currency. Then you can transfer the money to the seller’s account directly. WGD Real Estate shall assist you for this currency exchange issue.
The purchasing contract is issued by Real Estate Bureau. It is a standard copy. For the additional clauses, shall be added after discussing with the seller. Before preparing the contract, you need to remit the deposit to the developer to hold the unit for around 2 weeks. This two week is for you to read the contract. The down payment shall be made within 2 weeks after signing the contract.
Since most of the properties are sold before built, you need to sign the contract, to do the down payment, start to pay the monthly loan before handing over the property. This means you pay the money in advance.
For new property, most of the owner shall get their property licenses around two years after handing over the property.
For purchase a second hand property, the procedures are as follows（WGD’s professionals shall assist you do the purchase before, during and after the property title transfer）:
1) Advised by your investment agent-WGD Real Estate to selecting the valuable properties.
2) Select the right properties.
3）Pay a visit.
4) Negotiation the prices and payment issues.
5) Read the Sale and Purchase contract.
6) Consult the appointed lawyer for the safe title transaction.
7) Sign the format sale and purchase contract through the real estate bureau.
8）Do the payment according to the signed Sale and Purchase Contract.
9) Hand over the property to the purchase.
10) Do the title transfer （the transaction is shortened to 7-10 working days）
The related fees to the purchaser are:
Maintenance fee: RMB 200/sqm for the apts which is high rise ( more than 6 floors high), RMB 100/sqm for the low rise apts and the villas.(Thansfered from the seller to the buyer, this fee shall only be paid once, no matter the title transfer )
Land tax (for Apts): 3% of the purchasing price (RMB 9,300/sqm up), 1% of the purchasing price (RMB 9,300/sqm under, the property’s size has to be under 147sqm.)
Land tax (for Villa): 3% of the purchasing price。
Stamp tax: 0.05% of the purchasing price
Lawyer fee: around RMB 5,000
Agent service fee: 2.5%. For different properties, the service fee is different due to the procedure efforts by the agent.
Notarization fee: Around RMB1000
If taking a mortgage:
Registration fee: around 0% to 1% of the loan amount.
You could get a 60% to 70% mortgage at the foreign bank (USD loan or RMB loan) or some Chinese bank (USD loan or RMB loan).
For leasing out, you need to pay the agent fee equal to one month rental. For receiving the rental, you could open an individual (RMB & USD) account at any bank with your passport. The tenant can remit the rental to your account directly. You shall pay 5% rental tax to the tax bureau to obtain an official receipt. WGD Real Estate shall apply this for you.
If you are not in China or no time to deal with the leasing issues, you could authorize Beijing WGD Real Estate Company to manage your property, such as looking for a tenant, contract management, asset management and lease management. The service fee is around 2% of the monthly rental. If the property is vacant, the management fee shall be according to the marketing rental.
For taking the rental out of China, you shall provide the contract and the tax receipt. Your authorized agent-Beijing WGD Real Estate Company shall do this for you.
For sell a property, the seller needs to pay the following fees（WGD’s professionals shall assist you do the purchase before, during and after the property title transfer）:
Stamp tax: 0.05% of the selling price
Agent fee: 2% of the selling price
Lawyer fee: around RMB 5,000
Business tax:
For the domestic landlord: 5.5% of the selling price if to sell within two years after obtaining your property license.
For the foreign landlord: 5%
For the domestic landlord: 5.5% of the business tax for the gain value part over two years after obtaining your property licenses.
For the foreign landlord: 5%
(No tax if obtaining property licenses over 2 years and the property size is under 144sqm.).
If the gain value exists:
Individual tax: 1% of the selling price.
Land value gain tax: 1% of the selling price.
Property tax：0.84% to the original property purchasing price every year from the date of check in on.
Late payment penalty: at least 1/3 of the property tax（the detail amount is according to the tax bureau’s final calculation.）
When submitting the application of the title transfer, the seller should provide the original property purchasing invoice, land tax invoice, property license and land license while the purchaser should provide the land tax letter, sale and purchase contract, other related documents such as Chinese name notarization, passport translation notarization, and authorization notarization notary and ect.
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