Renting an Apartment in Shanghai: Some Practical Tips

We’ve lived in Shanghai for almost 5 years now and have rented four different places in this time (#4 about to start). Moving is a pain, but it’s given us some valuable experience. Here are some tips based on what we’ve seen.

Looking for apartments in Shanghai usually involves a real estate agent who will help you find an apartment. You’ll be asked to sign a one-year rental agreement. Anything less is difficult, but can be done with special arrangements, but only with a minority of landlords. Those needing an apartment for less than a year might try subletting a place listings at SmartShanghai.com or by personal connections with Shanghai residents willing to let someone use a room for a while.

You will need a lot of cash. In general, apartments are rented out one year at a time with contracts requiring one or two months’ rent as a deposit, and then upfront payment of the first two or sometimes three months of rent. This is a big surprise for many foreigners coming here, for it means that obtaining an apartment in one of the most expensive cities on earth will require at least three and usually four or five months of rent paid before you can even move in. In addition, you will also need to pay 35% of one month’s rent (typically, but be sure to check) as a fee to the real estate agent. (That may seem like a pretty steep fee for the work of signing you up for an apartment, but it’s actually worse than that because the landlord has to pay also, and the going fee now seems to be 100% of a month’s rent as payment from the landlord to the rental agency they signed up with.) Many foreigners coming here are shocked to see how expensive apartments are (e.g., often 2 or frequently even 4 times as much as in many US cities), and are even more shocked to see how much cash they have to provide in their first few weeks.

The company that brought you here typically won’t help with any of that upfront cash you need to pay. If they offer housing assistance, as many do, it comes in the form of a monthly stipend that will start after (maybe a month or even two after) you’ve paid all that cash and moved in. You will need to provide a fapiao (official government tax receipt) for the first month of rent from the landlord to your work and it must be listed with the exact name of your company (generally) in order for you to get reimbursed for one month of rent at a time.

For the process of finding the apartment, here are some tips:

First, if you don’t speak Chinese, bring or hire a Chinese-speaking friend to help you get the information you need. If you rely on rare English-speaking agents, your choices will be much more limited and it will be hard to find multiple agents covering a desired region, which is part of Tip #2 below.

Second, work with more than one real estate agent to find a place to rent. The listings from landlords are not all visible to every agent, so the perfect place for you might not be known to the first agent you work with. The quality and diligence of agents varies greatly. Most recently, for example, we started looking about seven weeks before our current contract ended. We had one agent we really liked who took us to a few places but then told us that we needed to wait a couple of weeks before we came back because landlords were not willing to sign a contract what would start in mid-June when it was only early May. But as we were saying good-bye to that agent, another one approached us on a street corner and said he could do better and that he thought it wasn’t too early too look. He worked hard to come up with some places where the landlord was somewhat flexible, and we soon found an ideal place that we’ll be moving into shortly. But during out search, we worked with three different agents, each with different listings and different strengths.

Third, be very clear about what you want and understand where you can compromise. Some people want to be up high enough to have very few mosquitoes. But if you could save 1000 RMB with a place on the first floor, could you cope by using bug zappers and mosquito netting over your bed? Do you really need two bathrooms? If you have lots of guests, this can be especially valuable. Understand how much space you need for the kitchen. Do you need an oven? Do you need a dryer? These are rare but some places have them. Understanding the difference between “nice to have” and “game over if I don’t have” is vital, because you are probably going to have make some compromises or pay a lot more than you want.

Fourth, generate lists of questions and issue to consider and discuss by visualizing details of your life when you are in an apartment you are considering. Look at the kitchen layout and consider how you would use it. Is the fridge too far away for practical work? Is there inadequate storage space? Obvious dangers? In other rooms, look at the electrical outlets and see if there are enough. See if windows can be closed and sealed off in winter to keep cold air from flowing through your home. See if air conditioners work, hot water flows, etc. Sit calmly and listen: is there lots of honking from street traffic, or are you in an peaceful place where you have a chance of getting decent sleep? Try out the furniture. Designed for someone half your size? Feel the bed. Rock hard? If reading is important to you, is there a comfortable place with decent lighting you can use? Look carefully at the neighborhood and the street you will live on. Is the traffic clogging the road all the time? Are there no taxis? Also, make sure your clearly understand if the quoted rent includes a fapiao (if you need two fapiaos, this could be trouble, and make sure that is clearly and plainly explained, and make sure you explain that you need real fapiaos, not fake ones–no kidding!). Ask if there are any extra fees you are responsible for. Will there be an installation fee to start Internet or TV service? Understand parking rules for you or for visitors.

Fifth, don’t trust everything you see or hear. Many online apartment listings rely on fake information to lure you in, and some agents you meet will feed you fake information to win you as a client. This fake information will be a listing that looks absolutely perfect, such as an ideal apartment in the place you want, in your budget, with loads of cute extras that make it seem like a real steal. When you call the agent to schedule a visit, you’ll find out that it has “just been sold.” That same apartment may end up “just being sold” over and over again. It may not even exist. I suggest not relying on that service or agency if they play that game. Further, real estate agents will often make statements when they don’t really know the answer. Be suspicious and ask how they know. Some agents, especially those working for firms that seem to be trying hard to push market prices higher, will quote you greatly inflated prices. Checking with multiple agents can give you a feel for what the real price should be for a given type of apartment.

Sixth, negotiate. Three times we have offered somewhat less than the asking price and had success, but if you ask for more than, say, a 10% reduction, you might not only get a rejection but find that the landlord is not willing to talk with you any more at all. But do negotiate, respectfully. In one place, we pointed out how terrible the furniture was and got the landlord to agree to lower rent if we scrapped some wasted furniture and bought our own instead of requiring the landlord to buy new items. We got 1000 RMB a month off our rent which quickly paid for the cheap used couches and a used bed we bought from expat friends who were moving back to the US. In another place, we got the landlord to buy an over for us if we would pay 500 RMB a month extra, which was fine with us–but in the end a bad deal for us because we stayed there two years, and an over costs about 5000 RMB. Oh well!

Seventh, allay landlord concerns. The visit to an apartment with a landlord present is a two-way interview. You are trying to find out if the landlord will be reasonable, but the landlord is keenly interested in seeing who you are. They have invested way too much money in this place and don’t want to lose it through a disastrous tenant. Dress nicely. Be on time. Be very pleasant and polite. Compliment the landlord on the things you see that are positives. Act like a considerate guest. The feeling they have about you can play an important role. They want responsible, trustworthy people who aren’t going to trash the apartment or sublet it to a tribe of party animals.

Eighth, once you’ve found the right place, be prepared for the closing. Find out if the landlord wants the upfront payments in cash or via an electronic deposit (credit cards often are not accepted for these kind of things). If you need, say, 40,000 RMB, realize that you can’t get all of that on one day from an ATM machine, but you can get it from a bank if you have an account there with that much in it. Otherwise you may need to have money wired to China from a US bank. Also as part of preparing for closing, ask the agent to get a copy of the contract to you before the closing so you can review it, and make sure it is in English and Chinese (but the Chinese terms will govern if there are any differences). If they have changed the agreed-upon terms or offer new unexpected conditions, be ready to walk. Also have someone who knows China and Chinese be there with you are at least available to help if there are any issues or questions. Inspect the apartment carefully and make sure agreed-upon repairs or changes have been done or are spelled out in the contract.

Ninth, prepare for moving out of your old place.  Be sure to give your previous landlord plenty of notice (usually by 30 days or a month before the last day of your contract, you need to give written notice if you aren’t going to continue) and cooperate fully to help them sell the place. Keep it clean. Do your best to be thoughtful of your old landlord. While that’s just good human behavior, it also has a practical aspect: it may increase the chances of you getting your deposit back, or at least some of it. Sadly, some landlords make excuses and keep the deposit. We’ve had luck so far in getting our deposit back, though we have another deposit quest coming up soon. Wish us luck. Have an inspection meeting with your former landlord to review the apartment and see if there have been any unusual damages. It may be good to have photos of the place when you moved in and photos of the current place to show that you’ve taken good care. If you’ve spent money on repairs or other things, receipts will be helpful. You may need to prove that the furniture you wish to remove from the apartment is actually yours, since the door guards (“menwei”) at apartment complexes are trained to prevent theft from departing tenants and so will require conformation from the landlord for you to remove something you may own. Make sure you move on a day when the landlord is available by phone.

Tenth, when you move, take many precautions and get help. Hire movers to move your stuff if you have a lot, and watch over the process carefully. They may be fly-by-night and can damage many things. Work with them to protect whatever is really valuable or move it yourself. For special items like a piano, go to a piano shop and get their recommendation for skilled piano movers. Work with the agent and landlord to make sure that services like power, Internet, gas, etc. are operating when you move in. Be very careful not to damage walls, flooring, windows, or light fixtures as you move in. Make sure you have keys and understand how to enter the complex and the building (passwords, key tokens, etc.?).

It can be tiring, but with luck, you’ll have avoided major disasters and will find yourself in a pleasant new setting in one of the most delightful and beautiful cities on earth, Shanghai.

By | May 29th, 2016|Categories: China, Consumers, Housing, Shanghai, Shopping, Surviving|Tags: , , , , , , , , , |Comments Off on Renting an Apartment in Shanghai: Some Practical Tips

Beware Fake Rental Fapiaos (Receipts) in China

Many expatriates living in China receive housing stipends that cover at least part of the monthly cost of rental here. In expensive cities like Shanghai, getting your housing stipend can be essential. Your reimbursement, though, requires that you provide a “fapiao” (official receipt from the government) which shows that taxes have been paid. The tax rate right now is 5%, so your fapiao of, say, 8,000 RMB costs your landlord 400 RMB. Your employer then uses the fapiao for some kind of tax benefits in reimbursing you. If you don’t provide a proper fapiao, you generally won’t get your housing stipend.

A few things can go wrong on this process. Make sure you know exactly what name your company requires to be on the fapiao. For me, it has to be the proper legal name of my company, not my name and not other commonly used versions of my employer’s name. One time my landlord bought several months’ worth of fapiaos all at once, but used the corporate name I pointed to on my business card instead of the official legal name, and I ended up having to pay for new fapiaos out of my pocket. In that process, though, I learned that getting fapiaos involves going to a local tax office, showing your rental agreement and your passport, and then simply paying 5% of your rent to buy the fapiao.

Also make sure you get fapiaos by the month. Your company will generally want one for each month, not one for three months at a time, even if you pay your rent once every three months as I do.

A more troubling problem you may encounter is fake fapiaos. Fake receipts? Yep, it happens, and is an easy way for an unscrupulous person to make some quick money. This may happen when a real estate agent, after closing the deal for your apartment, offers to save the landlord the trouble of getting fapiaos. The agent may have a friend allegedly at the tax bureau who can help you get the fapiaos easily. If the agent doesn’t need a copy of your rental agreement, that’s a clear sign that something is wrong. I don’t know if the seemingly official fapiaos are printed on stolen receipt paper from government offices or are just really good forgeries, but they look like the real thing and businesses may accept them and reimburse you, but if there is an audit or careful investigation, they may discover that the fapiaos are fake and you may then be denied your reimbursement.

For Shanghai folks, you can check to see if your fapiao is real or not using a government website: http://www.csj.sh.gov.cn/wsbs/WSBSptFpCx_loginsNewl.jsp. It’s in Chinese, so you may need help doing this.

If you are getting fake fapiaos, let your landlord know. It can hurt their credit and their reputation with the government. It may end up hurting you. The crooks who are stealing your money (and stealing tax money from China) with fake fapiaos need to be stopped. Of course, your agent or whoever gave you the fake fapiaos will be shocked that their friend in the tax office made some kind of error. Maybe they knew, maybe they didn’t, and maybe it was all an innocent mistake, but given the easy money to be made, chances are someone is just pocketing the money, and not pocketing it accidentally.

Unfortunately, one acquaintance of ours says that she got fake fapiaos by going to the fapiao office her business told her to use. I think this was an official fapiao office but I need to confirm that. Whether it was an accident or intentional theft, you need to recognize that there is a possibility that the fapiao you get is fake. Check to make sure they are legit, and try not to get too many months of fapiaos all at once in case there is a problem with them.

By | May 18th, 2015|Categories: China, Finances, Housing, Products, Scams, Shopping, Surviving|Tags: , , |Comments Off on Beware Fake Rental Fapiaos (Receipts) in China

More Tips on Moving in China: Trucks, Boxes, Etc.

When you are moving in China, there are several things to do to prepare.

First, review your current rental contract and make sure you give adequate notice and comply with other terms needed to ensure you have a good chance of getting your rental deposit back. It’s often two months of rent, so you don’t want to lose this money. Be a good tenant, give adequate notice before the end of the contract so they have time to find a new tenant (if leaving mid-year, you may not be able to get your deposit back at all). Make sure you leave the place clean and handle outstanding bills for utilities (this may include leaving enough money in the hands of the landlord to cover estimated costs, or taking other steps).

Second, prepare well in advance with the supplies you will need such as boxes, tape, bubble wrap, scissors, string, etc. If you move, you may want to get a lot of boxes. These can be hard to find on sale, but you can get them at B&Q for about 15 RMB each. Cheaper is to track down a recycler carrying loads of boxes and boxboard down the street. He’ll sell you boxes for maybe 2 RMB each. Cheaper still is to go to department stores or other places discarding boxes and take away used boxes for free. Keep some boxes around the house–they often come in handy and can be a pain to find when you need them. Also prepare by getting bubble wrap, newspaper or wrapping paper, and lots of good packaging tape, which isn’t always easy to find. When you see it, get some well in advance. You can also order boxes and tape online at Taobao.

Third, arrange for help such as a moving service to get you and your stuff to your new place. This often involves using a local moving service. Order a truck that is bigger than what you think you need so you can avoid two trips. A medium truck going across town might cost you 700 RMB if just one or two people are needed. Since we were moving a piano, we had a large truck and a crew of four, which costs us more than we expected: 1700 RMB. But it was a solid half-day of work for four people, and the extra-large truck had a 500 RMB surcharge. But had we negotiated ahead of time as we should have, I think we might have only paid 1300 RMB or maybe 1400. Lesson learned, maybe. While arranging for moving muscle, it’s also wise to hire an ayi or two (maids) to provide cleaning muscle for your new place and your old.

Fourth, pack early. Don’t wait until the night before the move. Your stuff is important and you don’t want to lose it or misplace it through careless packing. Mark boxes so you know what is where. Wrap delicate things carefully and be prepared for rough treatment. Make sure you don’t take things that are part of the apartment, either. Spend a few hours every night for a week to get prepared, if you can.

My experiences in moving in China have been limited to Shanghai, but the principles should apply to other large cities as well.

Related posts:  Tips on Finding an Apartment in Shanghai, Renting in Shanghai

Related pages: Surviving in China

By | July 1st, 2014|Categories: China, Consumers, Housing, Shanghai|Tags: , , |Comments Off on More Tips on Moving in China: Trucks, Boxes, Etc.

Finding an Apartment or Moving to a New Apartment in Shanghai

After 3 great years in the Lao Xi Men area of Shanghai (West Gate Apartments on Xizang South Road a little south of Fuxing Road), we have moved close to the Yili Road subway station on Line 10, which puts us in the Gubei area. It’s quieter, cleaner, and with a surprisingly high concentration of fun restaurants and beautiful spots such as the marvelous New Hongqiao Park. We moved because my wife already has too long a commute, and I just found out that my office will be moving to a location closer to where she works, so, as our previous contract was coming to a close, it made sense to move rather than renew. We were delighted with what we found, and it even saves us money.

There are several ways to find housing in Shanghai. Many people do it themselves through word of mouth or especially through online postings. For foreigners, the most popular tool seems to be the housing section at SmartShanghai.com.

For many, another popular way to find an apartment in Shanghai begins with finding a good real estate agent. Quality varies wildly. Some are inexperienced and not very helpful, while others go the extra mile to get your the right place at a good price and make your move a success.

Our move to a new place was greatly assisted by one of the best real estate agents I’ve ever worked with. He speaks terrific English and went the extra mile to help, not just before the deal is closed but especially after. After the deal was signed and his fee pay, he continues helping us. He has helped us set up our Internet service, he made the calls to get our budget TV subscription turned on, he helped us solve some other minor problems, he told me today which office to go to and what to bring to register with the police after our move, he picked up and delivered our fapiaos, and he even came over to show us how to change the combination on our door. He’s extremely kind and really committed to serving his clients. He can help clients anywhere in Shanghai. I can give you his cell (email me at jeff at jefflindsay d0t com) if you wish.

Update, June 2015: We would later learn that the help that his office provided in arranging Internet access and managing fapiaos was not quite on the up-and-up. We paid for high-end Internet service but got the lowest end, and the rental fapiaos were fakes. Our agent was surprised and quickly corrected both problems once we detected them. He said were the fault of his staff at the office. This can be a problem with any agency, so if you have them help you with those things, you need to check carefully and ensure that you are getting what you pay for. The temptation for people to pocket extra money is hard to resist.

When you are looking for an apartment, start with the region you are interested in and find an agent that serves that area. A good company like David’s can access broad listings and work local connections to help you find candidates where you want. Some just have listing for fixed regions, but they can he helpful, too. Your agent will take you to view available places. A lot depends on whether you want furnished or unfurnished. Then you need to set a budget (ouch, they are expensive here!) and determine what total area you want to consider (e.g., around 50, 100, or 150 square meters) and how many rooms you want and what other features you want. The more places you look at, the more you can recognize what features are important.

For us, having a big kitchen with either an over or a space where we could install one was important because we do a lot of entertaining and a lot of cooking, and our style of cooking often requires an over, something most apartments in China do not have. China is a nation of stove-top cooking. Ovens in apartments are rare. But you often can take out the ubiquitous and worthless “sterilizer” unit in many kitchens and replace it with an over, though electrical connections will have to change and the landlord must be on board (and make it clear what happens with the unit when you move away). In our last place, we agreed to a higher rent in return for the landlord buying an over that would stay with the apartment–good deal for him. We’re buying the oven in the new place. Will cost about 4800 RMB.

When you rent, you will normally be asked to pay a deposit of two months’ rent in addition to one or two months rent up front, so you really need a wad of cash to get started. Foreigners coming to work in China often don’t know this. In addition, the renter will typically pay the commission to the agent, which is normally 1/3 of a month’s rent, sometimes a little higher. Before you rent, make sure you negotiate any significant changes that are needed like painting the walls, repairing things, replacing or adding furniture, etc. Make sure you know how to handle utilities, how to get Internet and TV, how to register with the police, etc. If you need a fapiao, this costs 5% of the month’s rent, so make sure you know who is paying for that (it is normally included in the monthly rent).

Everything can be negotiated, so perhaps you can close a deal for less (typically around 10% less) than the asking price. Ask for too low, though, and the landlord will throw you out and not negotiate further.

Landlords in China might often own just one rental apartment that they rent out. It’s a precious piece of property to them and they may be evaluating you as much as you are evaluating the unit. If you seem too demanding, slovenly, or irresponsible or do anything to create a negative emotional reaction, they might not rent to you, even if you accept the asking price. I know two Chinese guys who were planning to rent an apartment together and had agreed on the price, but the landlord got nervous about how clean two men would be and decided at the last minute to turn them down. End of story. For best results, dress nicely and radiate “clean, responsible, friendly” if you can.

When you close the deal, you’ll sign a contract, typically in Chinese and English, and it’s almost always for a year. Have someone you trust review it. In this case, the contract was standard from Oriental Real Estate which we already trusted, and it worked out fine.

If you move, you may want to get a lot of boxes. These can be hard to find on sale, but you can get them at B&Q for about 15 RMB each. Cheaper is to track down a recycler carrying loads of boxes and boxboard down the street. He’ll sell you boxes for maybe 2 RMB each. Cheaper still is to go to department stores or other places discarding boxes and take away used boxes for free. Keep some boxes around the house–they often come in handy and can be a pain to find when you need them. Also prepare by getting bubble wrap, newspaper or wrapping paper, and lots of good packaging tape, which isn’t always easy to find. When you see it, get some well in advance. You can also order boxes and tape online at Taobao.

I also recommend hiring an ayi (local maid) to come in and clean your new place before you move and also to clean out your old place after you move out, leaving it in good condition to keep a landlord and the next tenants happy.

By | June 24th, 2014|Categories: Consumers, Housing, Shanghai|Tags: |Comments Off on Finding an Apartment or Moving to a New Apartment in Shanghai