China's new housing rules may lead to divorce surge | world | Hindustan Times
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China's new housing rules may lead to divorce surge

world Updated: May 03, 2010 12:47 IST

Buyers of new house in China may resort to divorce or postponing marriage in order to save money as per the new housing rules, a report in the Economic Information Daily said.

The central government announced a new housing regulations on April 15, under which the down payment requirement for a family purchasing a second house has been raised from 40 per cent to 50 per cent with the mortgage rate 1.1 times the benchmark interest rate.

Moreover, a much higher down payment and mortgage rate would be required for the third home and beyond.

A couple in Central China's Hunan province found they would have to pay an extra 50,000 yuan and 100,000 yuan as the down payment and loan interest, respectively, under the new regulations, for their estimated 720,000 yuan second apartment.

However, the real estate agents dug out a convenient shortcut for the couple to save the increased 150,000 yuan cost- getting a divorce.

"The home regulations are family-based, thus I can pay a 30 per cent down payment and enjoy the 15 per cent discount in mortgage rate once I get divorced and become single," the husband calculated, "then we can remarry after the purchase".

Facing similar situations, others are also postponing marriage in order to buy an apartment under the conditions of the old housing policies.

A lawyer surnamed Feng in Changsha told the Economic Information Daily that frequent marriage and divorce are protected by law even if the two sides do it out of some ulterior motive.