Buying Property in China as a Foreigner: Rules, Limits and the Succession Question

The 2015 relaxation changed the baseline

For years the governing rule was the 2010 joint notice of the Ministry of Housing and Urban-Rural Development and the State Administration of Foreign Exchange (No. 186 of 2010), which required a foreign individual to have worked or studied in China for more than one year before purchasing a home. That requirement was lifted by the 2015 notice adjusting the administration of foreign individuals' housing purchases (No. 122 of 2015), which took effect August 27, 2015.

The current baseline is therefore simpler: a foreign individual holding a valid passport (or a valid travel document for Hong Kong, Macao and Taiwan residents) may purchase residential housing for self-use. The one-year residence test is gone; what remains are the purpose condition, the unit limit and local purchase restrictions.

The purpose condition and the unit limit

Foreign individuals may buy residential housing for their own use — not for speculation or investment. The purchase must be made with the buyer's own funds settled through a bank's foreign exchange settlement channel, and the rules have been read to permit one self-use residential unit per foreign individual, with regional variations in how strictly that is applied. If a property is sold, the proceeds may be remitted abroad through the bank, subject to the foreign exchange procedures.

Documents that commonly need to be prepared include the buyer's valid identity document, evidence of the purpose of the purchase, and — depending on the city — a notarized translation of the identity documents and, in some cases, a notarized purchase contract.

Local purchase restrictions override the national baseline

National rules set the floor; municipal 限购 (purchase-restriction) policies set the ceiling. Beijing, Shanghai, Shenzhen and other cities apply their own eligibility tests — typically proof of continuous social insurance or individual income tax records in the city, and caps on the number of residential units any buyer may hold. Foreign buyers are not exempt from these local rules, and the requirements differ from city to city, so the answer to "can I buy here?" is always city-specific.

Ownership is governed by the law of the place of the property

China's Law on the Application of Law for Foreign-Related Civil Relations points firmly to lex situs. Under Article 36, real rights in immovables are governed by the law of the place where the immovables are located — so questions of acquiring, holding and transferring ownership of a Chinese apartment are answered by Chinese law, not by the buyer's home law.

What happens to the property when the owner dies

The same statute reaches the succession question. Under Article 31, statutory succession to immovable property is governed by the law of the place where the property is situated — again, Chinese law. That single choice of law has practical consequences a foreign buyer often overlooks: the Chinese rules on intestate succession, the statutory shares of spouses and children, and the effect of a will drafted under another legal system all need to be checked against Chinese law, because the apartment itself will pass under Chinese succession rules.

This is why a foreign owner should not assume that a will drafted at home, or the forced-heirship rules of their home jurisdiction, will simply apply to the Chinese property. A cross-border estate plan should treat the Chinese real property as a separate, Chinese-law asset and structure the will accordingly.

Practical steps before you sign

• Confirm local eligibility first. Check the purchase-restriction policy of the specific city before paying any deposit.
• Keep the funds traceable. The purchase price must come through the foreign exchange settlement channel; keep the bank records.
• Plan the estate at the same time. The property will pass under Chinese law, so the will should deal with it expressly.
• Watch the taxes. Deed tax and other transfer taxes apply at purchase; consult on the exact burden before committing.

Why the succession question matters up front

Most foreign buyers focus on the purchase — the eligibility, the funds, the notarization. The question that creates real difficulty later is succession, because by then the buyer is no longer there to fix the plan. A property bought without an estate plan can leave heirs navigating Chinese succession rules from abroad, at the worst possible time. The purchase and the estate plan should be done together.