, there has been a surge in married couples filing for divorce in China’s most populous city this week. The supposed reason for this may surprise you. It’s apparently because they feared missing out on a loophole which makes it easier to buy a second property.
Home purchasing rules in China treat married couples as a single unit. At present, a first-time buyer and resident of Shanghai can buy one property with a 30% deposit and 10% discounted interest rate. A married couple can buy up to two properties. The deposit for the second property has to be between 50% and 70%.
So by getting a divorce, even if it’s just on paper, couples can once again get the more favourable deposit rates enjoyed by individuals.
This playing of the system has apparently been happening It’s been partially driven by the booming property market in Shanghai, where the purchase of a first home, let alone a second, is beyond the reach of many on average incomes. But the sudden spike in divorce filings was apparently caused by a rumour that Chinese housing authorities were wise to this loophole and keen to shut it down.
The most common version of the rumour spread on social media was that from 1 September couples would have to have been divorced for at least 12 months before they could attempt to buy a further property as individuals.
Although officials strenuously denied there would be any such rule change this didn’t halt the stampede of people seeking to get unspliced before the rumoured restrictions were supposed to be introduced.
The Chinese economic magazine Caixin said that that long lines of people were spotted at one Shanghai district’s marriage registration centre on 30 August in order to secures their divorces. Other images, like the one below, also appeared on social media sites apparently showing similar queues of would-be divorcees