Shanghai’s next generation concedes defeat in housing war, drawdown housing fund to pay rent
Rocketing home prices and stagnant wages force many younger Shanghai residents to give up their dreams of ever being a homeowner in China’s most developed urban centre
An increasing number of younger employees in Shanghai, frustrated at the city’s runaway property market, are dipping into mandatory savings accounts that were intended to facilitate home ownership.
For many, the gap between wages and home prices has been stretched to the point where it no longer makes sense to save up to get on the housing ladder.
Ye Qiuyang, 32, decided to withdraw funds from her account, taking advantage of relaxed rules on fund withdrawals that came into effect in August.
“It was just dead money since I wouldn’t be able to use the housing fund to buy a home,” Ye said. “At least, it is no longer a dormant account if we are allowed to withdraw part of the funds.”
The Shanghai resident is among a new generation of white-collar workers seeking to access funds that were previously held in trust by the state.
Under the rule change, employees who are non homeowners in the city are allowed to withdraw a maximum 2,000 yuan (US$315) a month to use towards their rental housing expenses.