Renovation of Old Residential Communities
I previously shared that the lifespan of a residential community is roughly 15 to 30 years. If it’s still profitable, owners replace it with a new building; if not, they endure the inconvenience and keep living there. However, with the current policy for renovating old neighborhoods, many believe it’ll be free — which is impossible. Owners must pay. Take the case in the article: a 3,300-unit old community in Chengdu needed self-demolition and self-reconstruction. The government led the effort to secure bank loans, and each household took on a low-interest loan to fund the demolition and rebuilding (roughly equivalent to 4,000 RMB per square meter for a new apartment, though surrounding properties sell for tens of thousands). Of course, the plan still required unanimous consent from all homeowners, and after years of delays, nothing came of it.
Old renovations that are truly free typically involve former state-owned enterprises or government-housing units. These properties were allocated by the state and never transitioned into commercial housing, which effectively means the government retains permanent responsibility.