Divorce rate rising 41% in China because of real estate taxes…



Now we know the actual numbers of the divorce rate this year in China’s large cities: a sharp 41% increase. The reason is that divoce enables Chinese couples to avoid paying a tax on real estate sales.


Chinese people are joking online about the side effects of the tax adopted last year by the Chinese governement. Many couples prefer to separe themselves of teir partner istead of paying the tax, and the divorce rate rises, rises, rises…


Beijing city is particularly struck with this side effect, where 40.000 couples have divorced in 2013 so far, which is an increase of 41% compared with last year. This achievement is subject to laughter on the Chinese social networks, some people saying that it is the first time a government increases divorce rate when it actually wants to monitor real estate prices.


This is because of China large real estate problem, with prices increasing and being very hard to stabilze. Many measures have been taken to stop the price increase, which has been again around 20% last year for residential real estate, a rate considered far too high and with risks of eding to a social crisis, Chinese emerging middle class is looking for apartments to rent and is having real trouble finding an accomodation.


And the rise can be worse in some areas in Beijing where the rise is above 40% for new apartments, and the situation is the same in most China’s large cities with an exception in Shanghai where the market seems now more mature. In Guangzhou an Shenzhen, the rise is above 18% in one year.


In the meantime, some weddibgs have been made for wrong reasons as well. Since there is limitations for non married people to buy property in Beijing, or because non residents have limitations, many people try to find a bride to marry, buy an apartment and then divorce. This make the figures complicated to understand. More and more Chinese people are trying to turn the law at their advantage, looking for flaws.


The advnatages of divorce are that important, tens of thousands of dollars that people do not hesitate with the divorce. Some couple even consider marrying again after the tax issue is over.


The Beijing Municipal Bureau has made some warnings appear in the city’s town halls: be careful, a divorce might be irrevocable, the opportunity divorces might be definitive ones. Will this be enough to reverse the trend ?



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