Rental Apps Receive Millions in Funding
China is widely known as the most populated country on planet Earth, with roughly 1.4 billion people inhabiting the East Asian country.
China’s Population and Rent While China is widely known for excellence in several fields – it’s the oldest country on Earth, kicking you-know-what at sports played indoors like badminton and ping pong, and having more land mass than any country except the United States of America – the nation hasn’t been known for having one of the world’s hottest real estate markets. According to Jones Lang LaSalle, China hosts the 30th-most transparent realty market, which isn’t something to brag about. However, investing in China’s rental properties is taking the business world by storm. Tencent Holdings, Warburg Pincus, and Sequoia Capital are just three of many venture capital firms backing startups in the quickly-growing real estate market in the Far East. Who will win? Only time will tell.
China’s Rental Market Explained In most countries, at least here, in the United States, most homes are owned outright or backed by mortgages. Only 35 percent of United States residents live in homes secured by leases. However, the United States isn’t experiencing its properties’ prices rising faster than any other country on planet Earth; China, conversely, is experiencing such a phenomenon. Orient Securities Company estimates that China’s world of real estate will be worth roughly $660 billion by 2030 at the latest. Experts believe that China will practically be invaded by venture capitalists and fat-pocketed entrepreneuers for the forseeable future – that means a slice for everybody.
Technology Is Revolutionizing The Old-School Chinese Market For the longest time, Chinese real estate wasn’t dictated by modern technological devices, programs, or statistical means of making predictions and analyses. Today, however, rental management is being aided by tons of technology – and that’s unarguably great for companies entering the real estate fray. According to Ziroom investor Liu Xing, who’s also a co-founder of Sequoia Capital China, “[Winners] will be those who can provide high quality professional service by applying big data and technology.” Very true, Mr. Xing – solid prediction.
Just How Popular Is Renting In China? As referenced earlier, about one-third of the United States’ population rents their places of living. Just six months ago, only 2 percent of the Chinese housing market was made up of rental properties. While the United States market is already saturated with renters, the same can’t be said for China – and that’s a major factor contributing to the current boom in Chinese residences for rent. Renting isn’t as popular in China as it is in other countries because its government has pushed residents to live in densely-populated urban areas, though most Chinese citizens don’t like doing so. Times are a-changing, as someone famous once said.
Rounds Of Financing For Real Estate Endeavors Have Been Quite Successful Ziroom was able to pool together roughly 4 billion yuan, or about $6.36 billion in USD, to kick off realty development in China with the sole intent of renting them out. Warburg Pincus, on the other hand, has injected $8 billion in various Chinese real estate firms. Edward Schinik partner at Yorkville Advisors