Core Viewpoint - The newly announced "Housing Rental Regulations" will take effect on September 15, 2025, marking the first administrative regulation in China's housing rental sector, aimed at enhancing the stability and development of the rental market [1][2]. Group 1: Market Context - The Chinese housing market has historically favored purchasing over renting, leading to a relatively underdeveloped rental market. However, as the market transitions to a stock era, the role of housing rentals in meeting the needs of new citizens and young people is becoming increasingly important [1]. - According to the National Bureau of Statistics, over 25% of urban households in China were renting as of 2020, with provinces experiencing significant population inflows showing higher rental proportions, such as Guangdong at over 55%, and Shanghai and Beijing at over 35% [1]. Group 2: Regulatory Impact - The "Housing Rental Regulations" aim to stabilize rental relationships and incentivize investment by establishing clear guidelines for landlords, tenants, rental companies, and intermediaries [2]. - The regulations encourage homeowners to rent out their properties and support the transformation of old factories and commercial spaces into rental housing, thereby increasing the supply of rental units through multiple channels [2]. - The regulations are expected to foster the emergence of specialized housing rental companies, enhancing the professionalism within the sector [2].

Hot News - The State Council Premier Li Qiang signed the "Housing Rental Regulations," which will be implemented on September 15, 2025, emphasizing market - government cooperation and regulating housing rental enterprises [2] - On July 21, the National Energy Administration released June's electricity consumption data, showing a 5.4% year - on - year increase, with varying growth rates in different industries [2] - At a press conference on July 21, Foreign Ministry Spokesperson Guo Jiakun had no information on the possible meeting between Chinese and US heads of state [2] - The US Congressional Budget Office estimates that the "Big and Beautiful Act" will increase the US deficit by $3.4 trillion in ten years [3] Key Focus - The key commodities to focus on are coking coal, soda ash, asphalt, rapeseed meal, and glass [4] Night - session Performance - The night - session performance of different commodity futures sectors shows varying growth rates, with the precious metals sector having the highest growth rate of 28.87%, followed by the coal - coking - steel - ore sector at 14.71% and the oil - and - fat sector at 12.44% [4] Major Asset Performance - Different types of major assets have different daily, monthly, and annual growth rates. For example, the Shanghai Composite Index has a daily increase of 0.72%, a monthly increase of 3.35%, and an annual increase of 6.21%; the precious metals like London spot gold have excellent performance with an annual increase of 29.44% [6]

Core Viewpoint - The newly published "Housing Rental Regulations" aims to standardize housing rental activities, protect the legal rights of parties involved, stabilize rental relationships, and promote high-quality development of the rental market, with implementation set for September 15, 2025 [1][2]. Summary by Sections Overall Requirements - The regulations emphasize that the development of the housing rental market should align with national policies and encourage a combination of market-driven and government-guided approaches, promoting diverse channels for increasing rental housing supply and fostering market-oriented, professional rental enterprises [1]. Regulation of Rental Activities - Housing intended for rental must comply with legal standards related to construction and fire safety, ensuring no risk to personal safety and health. Non-residential spaces cannot be rented out for residential purposes. Both landlords and tenants are required to sign rental contracts under real names and adhere to specified behavioral norms [1]. Regulation of Rental Enterprises - Rental enterprises must provide truthful, accurate, and complete information about available properties, maintain rental archives, and establish sound internal management systems. Those engaged in subleasing must set up regulated rental fund accounts [1][2]. Regulation of Brokerage Institutions - Brokerage institutions are required to verify and record the identity of clients and property ownership before publishing rental information, conduct on-site inspections, and prepare housing condition reports. They must also clearly price their service fees [2]. Strengthening Supervision and Management - Local governments at the city level and above must establish rental price monitoring mechanisms and regularly publish rental level information. Property management departments must implement graded supervision based on the credit status of rental enterprises and their personnel, while industry organizations should enhance self-regulation [2]. Strict Accountability - The regulations stipulate strict legal responsibilities for landlords, tenants, rental enterprises, brokerage institutions, and relevant government officials in cases of violations [2].

Summary of the Housing Rental Market in China for H1 2025 Core Viewpoint The rental market in key cities in China is experiencing slight fluctuations, with an overall average rental price decline of 1.37% across 50 cities in the first half of 2025, while first-tier cities show more stability [1][2]. Group 1: Rental Price Trends - The average rental price in 50 cities decreased by 1.37% in H1 2025, with a more pronounced decline compared to the same period last year [2][4]. - In June 2025, the average rental price was 35.0 yuan per square meter per month, reflecting a month-on-month decrease of 0.27% and a year-on-year decrease of 3.71% [2]. - First-tier cities experienced a smaller rental price decline of 0.56%, while second-tier cities saw a drop of 1.83% and third/fourth-tier cities a decline of 1.47% [4]. Group 2: Rental Income Ratio - The rental income ratio across 50 cities averaged 16.4% as of June 2025, down from 17.8% in June 2024, indicating a gradual decline [6]. - Major cities like Beijing, Shenzhen, and Hangzhou showed significant decreases in their rental income ratios compared to the previous year [6]. Group 3: Investment Returns - The rental-to-price ratio in key cities increased to 2.17% by June 2025, up from 2.09% a year earlier, indicating improved rental returns for quality assets [8][10]. - The rental market is benefiting from rigid demand and improved rental quality, leading to a more favorable investment environment [10]. Group 4: Affordable Rental Housing - As of the end of 2023, 573,000 affordable rental housing units have been completed, achieving 66% of the "14th Five-Year Plan" target of 870,000 units [11]. - The pace of affordable rental housing collection may slow down in 2025, with many regions lowering their annual targets compared to 2024 [12]. Group 5: REITs Performance - The overall performance of affordable rental housing REITs showed a slight decline in Q1 2025, with income and net profit generally decreasing by less than 6% [16]. - The issuance of affordable rental housing REITs has accelerated, with two new REITs launched in H1 2025, bringing the total to eight and raising nearly 12 billion yuan [16].

Core Insights - The rental housing market in China continues to experience a seasonal downturn, with average rents in 50 cities showing a slight decline in May 2025 compared to previous months [6][9]. Rental Market Overview - As of May 2025, the cumulative management of rental units by the top 30 centralized long-term rental apartment companies reached 1.923 million units, an increase of approximately 26,000 units from April [1][4]. - The average rent for residential properties across 50 cities was 35.0 yuan per square meter per month, reflecting a month-on-month decrease of 0.34% and a year-on-year decrease of 3.44% [6][9]. Company Performance - The top 30 companies in the rental market include various types of enterprises, with 11 being real estate companies, 9 local state-owned enterprises, 5 entrepreneurial firms, and 3 hotel-related companies [3][4]. - The leading company, Vanke Boyu, managed 196,600 units, followed by Longfor's OBO with 123,000 units [1][2]. Financing Trends - On May 21, 2025, Huatai Suzhou Hengtai Rental Housing REIT was officially listed on the Shanghai Stock Exchange, achieving significant investor interest [5]. - The private equity sector saw CapitaLand establish its first domestic mother fund in China, with a total commitment of 5 billion yuan, expected to contribute 20 billion yuan to its asset management scale [5]. Land Transactions - In May 2025, 69 residential land transactions were recorded across 22 key cities, with a total planned construction area of approximately 4.86 million square meters [12][13]. - Hangzhou led in transaction volume, while three rental land transactions were noted in cities like Ningbo and Shanghai [12][13].