Graduates Dilemma - Property - Shanghai
2015-07-27
I am astonished by the growth capacity of China the past 2 decades. What was once considered a nation of marred with tragedies has risen up to take its place amongst the best. However the growth of such magnitude has its pitfalls. It has been the GDP and nothing but focusing on the GDP for the past few decades and with that comes its cost.. rising cost of living, pollution and countless other troubles. However, it is to note that all nations have similar troubles and no single nation has been "safe" from this. There will always be trouble in one form or the other even for the "perfect" nations.
I am here in China.. in the so called elite cities - Shanghai.. Shanghainese are a proud bunch. Claiming to be the First class city of the nation and the world at large. I have to admit.. Facilities are excellent.. people are great.. food is second to none. But ..prosperity breeds disparity.
Beautiful Shanghai.. In its better weather days (old pic .. missing 2 new tall buildings) (Picture courtesy of china.org.cn)
Getting to the crux of the intended matter - Property.. property prices here in Shanghai.. Amazing. I've had the chance to visit some properties here in shanghai by virtue of looking for lease/rent .. and my inquisitive mind also inquired about the opportunities available to purchase properties. Well.. interesting as it may sound.. the property prices here are off the charts. Lets not even consider where the elites stay .. even apartments for the ordinary folks like you and me are far from affordable.
Lets do some maths
Pudong.. a 40m2 little loft costs about RMB 1m. A one room apartment(abt 50m2) in the outskirts.. decent place as well.. costs about RMB 1.5m.. which equates to an approximate of RMB 25k a m2.. minimum low flat rates.. and i have not gone to Puxi as yet..
So lets say for one to buy a 80 sqm apartment in the outskirts we may have to fork out 25k x 80m2 .. abt RMB 2m .. Lets say i get lucky and have parents to help out with 30% CASH downpayment .. about RMB 600k.. leaving 70% loan of RMB 1.4m.. if i do take a 30 years loan at 5% interest I WILL NEED TO PAY about RMB 9700 a month..
Those less fortunate.. wont have the deposit amount .. hence no house..
When will be one be able to save up for the deposit ? .. based on the above value.. 600k.. if u save 5k a month .. that will take 10 years .. thats from now.. how will the house prices be then ?
Based on survey by peking university.. average salary of fresh grads range about RMB 2500/month for the nation. For cities like Beijing and Shanghai it averages about RMB3500 to RMB 4500. Cost of living here in Shanghai isnt low.. I also understand that each individual is given a housing allowance(if thats what its called).. but thats to a minimal extent.
The maths don't add up..
However there is a silver lining in the clouds.. the average Shanghai salary scale is about RMB 20k.. which but when will one be able to hit that ? Assuming an average increment of 10% a year.. maybe one can hit the average at 15 years.. if u decide to stick to one company..
To make matters worst.. the ladies here demand a house from the men before even considering a date.
Talk about pressures in life.
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