Potential homebuyers examine a property project model in Yichang, Hubei province, Aug 23, 2016. (Photo/China Daily)
Couples in Beijing and Shanghai are considering divorce to buy a new home as rumors stoke anxiety over rule changes for property purchases
Beijing civil servant Li Zhen and his wife face a difficult decision: The couple may need to divorce to realize their dream of a bigger and nicer home.
If they do not split, at least legally, they may have to pay up to 1 million yuan ($150,000) in income tax if they sell either of their two small apartments, according to the current real estate policy. This would make their plan to upgrade financially impossible.
But if they divorce, with each taking ownership of one property, they could be spared the tax.
Time appears to be against them, too, as the market is rife with speculation that Chinese banks could tighten lending requirements for potential homebuyers, such as demanding higher down payments, from which unmarried people would be exempt.
"I know that if people work out what we're doing they'll despise me and even question my morality," Li said. "But what can we do?"
The Li family is not alone. Many happily married couples in Beijing and Shanghai who have seen house prices soar are facing a similar dilemma.
In Beijing, families with more than one property are required to pay a 20 percent tax on any profit made from a real estate deal. According to the regulations, families can own a maximum of two apartments.
