Ministry plans platform to provide rental information

China will push the growth of its housing rental market by setting up a rental information platform and encouraging alternative financing sources, according to a government document released on Wednesday.

The Ministry of Housing and Urban-Rural Development said a well-functioned housing rental market is crucial to meet the accommodation demand, especially massive migrant population. It vowed to cultivate institutions specialized in housing rental businesses, and encourage developers to allocate some of their houses for rent, instead of selling them off.

The ministry has proposed to establish rental information platforms across the country. Local governments have been asked to build such platforms to allow landlords and rent seekers to post information. China's commercial housing agents are notorious for posting false rent information on their websites to lure customers.

The ministry also reiterated the importance of Real Estate Investment Trusts (REITs). It asked local governments to launch REITs pilot programs and gradually expand them.

REITs are trust funds managed by specialized investment organizations. They collect capital from specific investors by way of income certificates and then allocate the funds for investment. They are favored by economists, developers and financial professionals alike as the funds securitize and invigorate existing assets, cut investment and holding costs for developers, and provide an alternative option in the capital market.