What Types of Houses Can You Buy? A Guide to Clarifying Property Nature

Commercial housing and existing housing: Commercial housing refers to new properties sold directly by developers, while existing housing refers to second-hand homes. Commercial housing is typically sold as pre-construction units, meaning buyers purchase directly from the developer. Existing housing is bought from current owners.

Military, central government, and university-owned housing: These properties generally cannot be transferred. It’s best to check with the local housing administration bureau to confirm whether transfer is possible before deciding to proceed. Only properties with a recorded status at the housing bureau can potentially be transferred.

Housing reform properties: The land under housing reform properties is allocated rather than purchased, meaning the original owner did not pay for the land but received it free of charge under national policy. The property certificate will indicate “allocated” land. If such a property is transferred to you, you’ll need to pay a land transfer fee. The cost varies by property type, ranging from as little as a few hundred yuan to as much as 10% of the transaction price. You should clarify this before making any purchase.

Small property rights housing: This term generally refers to homes built on collectively owned land. China recognizes two types of land ownership: state-owned and collective. State-owned land is owned by the government, while collective land is owned by rural communities.
Land owned by a collective can only be transferred among its members and cannot be sold to outsiders. In plain terms, houses built on farmers’ collective land cannot be purchased by urban residents or people from other villages. This prohibition has three key implications:
• The buyer cannot legally transfer the property.
• The sales contract between the parties is generally considered invalid.
• The seller can reclaim the property through a lawsuit. (If a developer is involved, contract disputes may be avoided, but the property may then be classified as an illegal structure.)

Affordable housing: This category includes both standard affordable housing and commercial properties managed under affordable housing policies. The latter are often products of internal housing allocation within state institutions. When purchasing, check the property certificate—if it’s designated as affordable housing, that will be clearly stated. Some affordable housing units can be transferred, while others cannot. Buyers interested in such properties should consult the government’s property transfer office to determine whether a specific unit qualifies as “transferable affordable housing” or “affordable housing that becomes transferable after five years.” If it does not meet these criteria, the current owner may still cancel the sale.

Demolition and relocation housing: This type of housing does not appear as a separate category on property certificates. Certificates will classify the property as either commercial housing, affordable housing, or public housing. Therefore, demolition and relocation properties fall under one of the categories mentioned above, and their transferability depends on how they are classified on the certificate. If listed as public housing, only the leaseholder can be changed.
There is one scenario where buyers can avoid the formal transfer process. Since demolition and relocation properties are usually constructed only after relocation agreements are signed, property certificates are often issued late. Buyers have two options: wait for the certificate before transferring ownership, or use a “contract revision” method. In the latter case, the developer responsible for issuing the certificate can update the property records directly under the buyer’s name at the current owner’s request. This bypasses the transfer process, so the certificate will immediately reflect the buyer’s name and no transfer taxes apply. (This can save money.)
However, the quality of demolition and relocation housing tends to be poor, and both the community environment and resident profile are often concerning. These properties typically struggle to appreciate in value and may even depreciate over time. Buyers should be mentally prepared for these drawbacks before purchasing.

Debt-offset properties: Also known as “debt-clearance homes,” these are properties held by creditors because the developer’s funding chain broke. While you can live in the property, the developer may still use it to settle other debts. Additionally, courts can seize and auction the property if the transfer process was never completed.

Court-auctioned properties: The risks are relatively low, but the main challenge is getting possession after purchase. Before an auction, property owners sometimes backdate lease agreements to take advantage of the legal principle that “sales do not break leases,” thereby preventing the new buyer from vacating the property (e.g., a 20-year lease).

Public housing: During the planned economy era, employers allocated housing to employees and managed it themselves—these are called “self-managed public housing.” In cities, many older homes are nominally government-owned but actually managed by the housing administration bureau, known as “directly managed public housing.” The “transfer” process for public housing occurs when the产权 unit—whether the housing bureau or another organization—changes the leaseholder from person A to person B. Although this resembles a property transfer, it is not a legally recognized form of ownership transfer.