Expert Specificity of renting an office and an apartment in China
Unobvious rules and unjustified pledges
Author: Sergey Gatilov - China expert, entrepreneur, 15+ years of life and work
Renting real estate in China at first glance seems simple: there are a lot of ads, prices are clear, contracts are standard. This is where foreigners often lose money. - Not because of scammers, but because of Chinese peculiarities, about which no one warns in advance.
Over the years of living and working in China, I have seen dozens of cases of tenants losing deposits, prepayments and nerves, believing they were acting “by the rules.” The problem is that the rules in China - completely different.
How to actually rent in China
The classic scheme looks like this:
- Payment 3 months in advance
- Deposit from 1 to 3 months
- Agency commission
- Separate service charges
It makes sense on paper. In practice. - Deposit is the source of most conflicts.
China bail - This is not a guarantee of return, as foreigners used to think, but an instrument of pressure on the tenant.
Why bails are often not returned
The main mistake of foreigners - Treat the contract as legal protection. In China, the treaty- It's a frame, not a guarantee.
The most common reasons for deposit retention are:
- Furniture wear (even natural)
- "Wall pollution"
- "Damage to technology" without evidence
- “Violation of conditions” without specific points
- “Repair after the Congress” at inflated prices
And most importantly, the landlord almost always holds the deposit in whole, not in part.
Personal example #1: apartment
In Guangzhou, I rented an apartment with a deposit of two months. Before the congress, the apartment was completely cleaned, the equipment worked, there was no damage.
Result:
- Withheld half the deposit.
- Reason. - "refreshing repair"
- No checks, calculations or photos
From the perspective of the Chinese owner - fine. From the perspective of a foreigner- It's unfair. It was pointless to argue.
Renting an office: even more difficult
If with an apartment, the losses are usually limited to a deposit, then with an office, the amounts can be much larger.
Features of office rental:
- Deposits from 3 to 6 months
- Mandatory repairs at the expense of the tenant
- Return of the premises to the original state
- Fines for early departure
In this case, the “original state” is often interpreted in favor of the landlord.
Personal Example #2: The Office
When renting an office for the company, we made a large deposit. A year later, the business grew, the room became small.
Outcome:
- Deposit withheld in full
- Reason. - "planning change"
- Even though it was agreed at the start.
This is a classic situation for China.
Why is this happening?
There are several reasons:
- The market is on the owner's side
- Foreigner - tenant
- Legal protection weak
- Court - long-distance
- Chinese logic: agreement is more important than treaty
The pledge is here. - Not insurance, but compensation for future risks.
How to minimize losses
Risks cannot be completely avoided, but they can be significantly reduced.
Working rules:
- Record the state of the room photo and video
- Prescribe depreciation in the contract
- Discuss the terms of return in advance
- Do not invest in repairs without written approvals
- Choosing the Right Landlord
And most importantly. - Understand the mentality of the other side.
Why renting without an expert is often a mistake
Most problems are not caused by bad people, but by a lack of understanding of the system.
I regularly help clients:
- Find an office or apartment
- Check the terms of the lease
- Assess the real risk of collateral
- Negotiate with the owners
- Avoid unreasonable losses
Sometimes my task is - Not to let a person sign a contract that looks profitable, but in fact turns into losses.
My personal conclusion.
Renting in China - It's not just about the price per square meter. It's about:
- Culture of arrangements
- Balance of forces
- Understanding unspoken rules
Those who know this experience lose less time and money.
Those who act “according to European logic” almost always pay for experience.
Unjustified bails in China - Not an exception, but part of the system.
They can be:
- Take it as an inevitable loss.
- Or learn to manage risks.
Working with China - It's always about nuance. This is where money is most often lost.
Expert contact:
Gatilov Sergey Ivanovich- Holiday Int. Ltd. (PRC)
Phone/WeChat:+86 18211220886
WhatsApp/Telegram:+7 9399161022
Mail:gatilove@mail.ru
