My understanding was that WZ leaseholders got a free pass because their case was high profile during the property boom: if they were going to be charged market rates for extending the lease, then people would begin to doubt that their 70 year leases would eventually be turned over easily as well. The government wants everyone to think that the leases are just like buying.
I think China will abandon the entire leasing system once they get a national property tax in place. The current system is unsustainable at the local level, and localities need the continuous income a property tax can provide, rather than the windfall of leases every 70 years (if that).
>WZ leaseholders got a free pass because their case was high profile during the property boom
Yes, pretty much it.
Shenzhen been very happy reselling land from all those short term leases under the new sky high prices for at least a decade.
Excerpt: "land user could apply for an extension without usage change if they pay a renewal fee based on the benchmark land price – the initial auction price on the land set by the local government"
Interesting fact FIY: the 2007 property law was the most debated act ever in Chinese legislature, with it failing to pass a number of times. While Chinese legislators are handpicked yes men, they also are quite wealthy people in their majority. Understandably, art. 149 was not on the govt's draft, but was added under the unprecedented extreme pressure from the assembly members.
Will the govt resort to the "nuclear option?" The temptation to solve the money problem in one swoop is just too high.
My coworker was evicted 2 month ago by his landlord in Shenzhen when the landlord suddenly learned that his land lease has expired when the police came to hand him a note without any prior warning.
I think China will abandon the entire leasing system once they get a national property tax in place. The current system is unsustainable at the local level, and localities need the continuous income a property tax can provide, rather than the windfall of leases every 70 years (if that).