Walking dogs and accompanying to doctors: Chinese real estate companies change profile due to market problems
Kyiv • UNN
Chinese property management companies are looking for new sources of income due to the market downturn, providing pet care and elderly assistance services. This includes dog walking, accompanying to doctors, and livestock care, allowing them to adapt to the new market reality.
Due to problems in the real estate market, Chinese property management companies are looking for new ways to make money. Now they help elderly people with shopping and doctor's visits, and also look after pets while the owners are away, UNN writes with reference to the South China Morning Post.
Details
The prolonged downturn in the Chinese real estate market is slowing down the industry's development and forcing residential complex managers to look for alternative sources of income, the publication writes.
Recently, according to a property management association report, one of the residential complex managers in Wuhan, the capital of Hubei province, looked after a family's domestic chickens during their absence. He fed the birds, moved them to an air-conditioned room, and even calmed them down during fights. The family thanked the manager with a thank-you poster.
This case showed how some of the country's property managers are willing to do everything to "adapt to a new reality in which years of rapid growth have ended," analysts say.
This was a strategy to overcome sector-wide pressure, as well as "a proactive step to capture new market opportunities."
In 2024, the total revenue of the top 500 Chinese property management companies grew by 3.7% to approximately $83.6 billion, according to CRIC Property Management, the research arm of China Real Estate Information Corporation.
For comparison, in 2021, this figure grew by 22%, while the government introduced the "three red lines" policy to limit excessive lending to developers.
According to the National Bureau of Statistics, in 2024, developers completed the construction of 740 million square meters of residential space, which is 28% less than in 2023.
At the same time, the top 500 property managers controlled a total of 19.3 billion square meters, which is 5% more than the previous year and more than 10% more than in 2021.
As property prices continued to fall, more and more homeowners were unwilling to pay management fees or wanted them to be reduced. In 2024, 74% of property owners, from apartments and shops to parks, paid management fees, compared to 89% in 2021.
Many property management companies were forced to terminate service contracts as homeowners demanded fee reductions to a level that made their operations unprofitable. According to CRIC Property Management, in July and August alone, managers, including units of Longfor and Country Garden, abandoned nearly 50 projects.
Traditional property management fees have limited growth, while labor costs continue to rise, forcing companies to seek new sources of profit through value-added services.
What services do companies provide?
According to CRIC Property Management, many property management companies have started looking for new areas of development, including services for the elderly and pet owners. By exploring these areas, managers can increase competitiveness while "creating demand and establishing a market reputation," Yan noted.
China is also facing rapid population aging: it is estimated that by 2035, more than 30% of citizens will be aged 60 and older. In Shanghai, where 37.6% of permanent residents were aged 60+ by the end of 2024, nine districts launched a pilot program in April encouraging property managers to provide elderly care services. This included one-time grocery shopping for 5 yuan, monthly garbage collection for 15 yuan, and escort to the doctor for 150 yuan per visit.
At the same time, the number of households with pets is growing in China. According to Goldman Sachs, by 2024, there were 120 million pets in urban areas, and the consumption market for dogs and cats exceeded 300 billion yuan. The number of animals has already exceeded the number of children under four years old.
Among the top 30 property management companies, more than half explored pet services:
- 43% offered boarding services;
- 23% — care
- 13% — grooming.
In August, a video went viral on Douyin showing a security guard in Zhengzhou, Henan province, walking a dog for a resident. Under the video, one user wrote:
Only this level of property management will make me pay for management