Finding an apartment in Shanghai is a rather curious experience, to say the least.  If you’re not sure what I’m talking about, go check out The Story Behind Our Apartment in Shanghai.  Even though Shanghai is actually quite westernised compared to what many people think, it is still not the same as back home.  There are huge cultural differences, both in everyday life and the business community.  To add to the madness, there is also a separate business code that applies to foreigners.  With the combination of the language barrier and the culture gap, there isn’t much that can’t go wrong.  It sets the stage for a version of Murphy’s law on steroids.  You don’t need to be incredibly imaginative to end up with a dreadful apartment that costs loads of money and only offers sadness.

This is a guide to finding an apartment in Shanghai that will help you to avoid mishaps and the misfortune of finding yourself in the middle of a scam.  The guide is written for Shanghai in specific, but most of the information will also apply to other big cities in China, with prices being the exception.

Finding a Real Estate Agent

The first thing you need to do is to find an agent to guide you through the foreign streets of this massive metropolis.  Finding an apartment in Shanghai is nigh impossible without an agent’s assistance.   Unless, of course, you are fluent in Chinese.

How to Find a Real Estate Agent

The best way to find an agent is to pursue one or all of the options below.

• SmartShanghai has a housing section on their website where agents can advertise their listings.  The page also contains the Wechat contact information of all the agents.  Most of these agents speak some English, so this is a good place to start.
• Talk to your colleagues and ask them if they know of any agents they can refer.  This is a great way of finding a good agent that you know won’t scam you.
• Go to a real estate agency in the area where you want to rent and work through them.  This method isn’t always the easiest or the cheapest, but it is the safest.  These agencies operate under a set of strict rules and regulations, which protect both you and the landlord.

Agent Costs

As you might have thought, agents don’t do charity work.  Most of them will charge a percentage of the rent as a once off fee.  The standard fee is 35% of one month’s rent, which is also the maximum fee, as far as I know.  Not all agents will charge that much, but most of them will require some payment.

Something to be wary of, are agents that don’t charge you anything or next to nothing.  I don’t want to be blunt and tell you to avoid these agents altogether, but I have a couple of friends that ended up on the back end of a deal because of such an agent.

So, when looking for an agent try to avoid agents that charge more than 35%, as well as agents that don’t charge you anything at all.

General Tips

It is customary for agents to show you their worst listings first.  Avoid jumping the gun and signing the first place you see.  Let the agent show you at least 5-6 apartments before you make a decision.  Better yet, make use of more than one agent to ensure that you are aware of all your options.

Never reveal your interest to your agent.  In China, most things can be bargained for and apartments are not exempt from this.  If you seem too interested the agent will be less likely to help you negotiate the price with the landlord.  You need to play hard-to-get to ensure you get the best possible price.

Remember to use your agent to your advantage.  Agents can act as mediators between you and the landlord.  They only turn a profit if and when you decide to rent an apartment, so utilize them to negotiate on your behalf.  A good strategy is to show just enough interest to let them think that you will take the deal if the rent goes down a little more.

How Much Should I Pay?

In a city, the size of Shanghai, your options for an apartment are about as close to infinity as it gets.  Apartments range from the ultra spacious and luxurious to spatially handicapped dwellings on top of questionable massage parlours.  If you have the time and the willingness to search you’d be able to find whatever your heart desires.  The only real question is whether your wallet supports the desires of your heart.

Prices of apartments vary considerably and balancing between your needs, desires and budget will require a delicate trapeze act of compromise.  Expect to pay anything from 3000 up to 16000 RMB a month for a one bedroom apartment and 1400 to 4500 RMB for a shared apartment.  Prices are influenced by a multitude of factors.  Below is my input on how the main factors influence the prices in Shanghai.

Location in the City

The location of an apartment is probably one of the most obvious factors to consider when talking about price.  As you might expect, the closer you are to the inner-city the higher the rent.  This is especially true in Shanghai and rent seems to go down considerably as soon as you start moving towards the outer limits.  The inner-city is generally thought of as the area that is enclosed by metro line 4.

The compromise you have to consider here is basically between the vibrant life of the inner-city and the cheap rent you can find elsewhere.  Depending on the place of your employment, you might also have to think about your commute time.  The metro and bus systems in Shanghai make it criminally inexpensive to get from one end of the city to the other, but it does cost time.  You’d have to ask yourself whether the money you save is worth the time you loose going to work every day.  It can also become quite the hassle to hang out with your friends.

Distance From the Metro

Another fairly obvious influence, but again it is something to bear in mind, is the distance from the metro.  The general rule of thumb is that the closer an apartment is to a metro station, the more expensive the rent.  It is a thing of convenience and you’ll notice that the proximity to a metro station is a major selling point of most real estate agents.

Here the compromise is one of convenience and whether it will affect you or not will depend on your preferred mode of transport.  If you intend to use the metro, which is a thing of magic in Shanghai, you will have to choose between tediously long walks to the metro and ridiculously high rent.  Fortunately, there are alternatives and you could always change your way of travelling.  You could use the bus, get an electric scooter (e-bike) or just get an apartment close to work and walk.

Western vs. Traditional

The more western and modern the apartment, the higher the rent.  There isn’t much to say about this one.  No matter where you go in the world, you will pay for luxury.  In Shanghai, it is no different and considering that you’re a foreigner, you will be paying quite a bit extra for the comforts of home.

Things to Check Before Renting an Apartment in Shanghai

When hunting for an apartment in Shanghai, there are certain things to be vigilant about.  Some of these are simple things that you would normally keep an eye out for when searching for an apartment back home.  Some are a bit less obvious and you might miss them without proper inspection.

Bathroom and Plumbing

A bathroom is what makes or breaks an apartment in Shanghai.  Well, that’s how it was for us at least.  The reason for this is that many apartments don’t have western style bathrooms.  In many cases, the toilet and the washing machine are basically inside the shower.  The entire bathroom is a larger than normal shower.  Now, this isn’t the worst thing ever, but it can be quite inconvenient at times.

Another thing you have to pay close attention to in the bathroom is the plumbing.  To be honest, I’ve seen long drops in South Africa with better plumbing than some apartments in Shanghai.  Plumbing is neglected to a great degree in many apartments because it’s something that is below the surface.  Even in expensive, newly renovated apartments, you see some really messy work in terms of plumbing.  So, make sure you thoroughly check the plumbing of an apartment before making your mark on paper.

If you’re not sure what to look for in terms of plumbing, here are some tips;

• Check to see that everything has been sealed properly.  Under the sink, in the shower and under and around the toilet.  Sealing around the toilet is especially important, because if not properly sealed you’ll have an awkward smell hanging around, at best, and a floor full of sh** in the worst case scenario.
• Take some toilet paper with you and test the flushing of the toilet.
• Test all the taps.  Hot and cold, sink and shower.

Moulds

Be sure to check the apartment thoroughly for moulds.  Moulds can be extremely harmful and are known to cause serious lung related illnesses.  If possible, try to avoid apartments with mould.

Bugs (Especially Cockroaches)

Yes indeed, Shanghai’s subtropical climate is ideal for these adorable creatures.  So, before you just sign away your privacy, check all the nooks and crannies for these hospitable roommates.  If you do find an infestation, either move on or demand the landlord fumigate the apartment before you sign any contract.

Air Conditioning

Make sure the air conditioning unit is working properly.  Summer in Shanghai can be pretty brutal, especially if you aren’t used to the heat and humidity.

Fapiaos

As an expat in China, you have to pay taxes to the Chinese government.  In order to lighten the tax burden on foreigners, the government has put in place a system that breaks up expat salaries into a base salary and an assortment of allowances.  You are taxed on your base salary only, which means that all the allowances are considered non-taxable income.

Your salary will most likely include a housing allowance and this is why you’ll need a fapiao.  The word “fapiao” translates to “invoice”.  It is basically a slip of paper that states how much rent you pay each month, very much like a receipt.  The only difference is that it is an official government document that exempts you from paying income tax on the part of your income you spend on rent.  The only downside is that you (or your landlord) have to pay to acquire it from the local tax department.

Before you sign the contract, ask both your agent and the landlord about fapiaos.  Inquire whether or not your fapiao will be included in the rent.  Also, find out if the landlord is familiar with the fapiao process.

Last Reminder:  After signing your lease contract and moving into your new apartment, remember to register at the local police station as soon as possible.  Both your employer and your agent should be able to assist you with this procedure.