Insights

What happens when Chinese land use rights expire?

30/12/2016

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Sharon Stark , Senior Associate

An article in the New York Times of 26th December 2016, reports that residential homeowners in Wenzhou will not have to pay a fee to extend their land-use rights which expired after 20 years. China has previously said that local governments must renew 70-year leases but did not clarify whether payment would have to be made for renewal nor the position for shorter leases. The New York Times article further reports that the decision in Wenzhou whilst not providing a national legal framework on land use rights in China, might be the precursor for other local governments adopting a similar position.

Chinese officials said that a group of homeowners in Wenzhou, an eastern city, would not have to pay a fee to extend the rights to the land under their residences. Homeowners in China own their dwellings but not the land under them. All land in China is owned by the government, which parcels it out to developers and homeowners through 20- to 70-year leases. In Wenzhou, the local government had told some homeowners whose 20-year leases had expired that they would have to pay a large fee to renew, and the situation was being monitored closely across the country. Many Chinese homeowners, a bedrock of the country’s economy and growing consumer sector, worried that they would have to pay dearly to keep using the land under their homes. http://www.nytimes.com/2016/12/26/business/china-wenzhou-land-lease.html

http://www.nytimes.com/2016/12/26/business/china-wenzhou-land-lease.html?_r=0