Rents in three first-tier cities have quietly gone up

The rent in first-tier cities is quietly rising.

In May this year, the average rent of ordinary residential properties in first-tier cities increased by 0.16% month-on-month, achieving month-on-month growth for three consecutive months. Year-on-year, in the first five months of this year, the average rent in first-tier cities ended two consecutive years of adjustment and turned to a slight increase of 0.21%.

Beijing, Shanghai, and Shenzhen have become the "leaders" in stabilizing the rental market in this round. Since the peak rental season in March this year, the residential rents in these three cities have continued to rise. Relying on high-quality industrial resources and a young working population, the rental fundamentals in first-tier cities are stabilizing first.

The Rent is Quietly Rising

The China Index Academy recently released data showing that in May this year, the average rent of ordinary residential properties in first-tier cities continued to recover, rising by 0.16% month-on-month. Looking at the cumulative increase or decrease this year, from January to May, the average rent in first-tier cities ended two consecutive years of adjustment and turned to a slight increase of 0.21%.

By checking the data of the previous two months, it was found that the average rent of residential properties in first-tier cities has increased month-on-month for three consecutive months. In March this year, the average rent of residential properties in first-tier cities was 73.21 yuan per square meter per month, a month-on-month increase of 0.34%. In April, the average rent of residential properties in first-tier cities increased by 0.26% month-on-month.

This means that the average rental cost in first-tier cities has rebounded month-on-month for three consecutive months.

However, the situation varies within first-tier cities. Beijing, Shanghai, and Shenzhen are the "leaders" in this round of the market, while Guangzhou shows a weaker trend.

Since the peak rental season started in March, the residential rents in Beijing, Shanghai, and Shenzhen have increased month-on-month for three consecutive months. Among them, Shanghai leads the rent increase among key cities across the country, with a month-on-month increase of over 0.5% in both April and May, ranking first among key cities. In contrast, the residential rent in Guangzhou decreased by 0.25% month-on-month in May.

The report from the China Index Academy shows that the rent increase in hot cities such as Beijing, Shanghai, and Shenzhen is mainly driven by employment demand. For example, in the main urban areas, industrial clusters, and densely populated residential areas of Beijing and Shenzhen, the rent mainly shows a moderate upward trend, and the market is concentrated in about half of the districts. In May, the warming up of the second-hand housing market in Shanghai drove up the landlords' rental quotation expectations, and the rent in each district of the city generally increased month-on-month.

According to the monitoring of the China Index Academy, in May, among the 50 cities, the residential rent increased in 11 cities, decreased in 39 cities, and remained unchanged in 0 cities month-on-month. The pattern of increase and decrease is basically similar to that in April. Among the top 20 cities in terms of residential rent, 7 cities had a month-on-month increase, namely Shanghai, Shenzhen, Beijing, Tianjin, Suzhou, Dalian, and Fuzhou, which are mainly first-tier and strong second-tier core regional cities.

More and More Demand for Improved Rental Housing

According to the "2026 China Urban Long-term Rental Market Development Blue Book" (hereinafter referred to as the "Blue Book"), the supply side of China's housing rental market is undergoing a structural change centered on the quality improvement and transformation of the existing stock.

More than 60 million sets of potential idle residential properties for rent across the country urgently need large-scale quality improvement, transformation, and efficient utilization. And the landlords' willingness to transform has significantly increased: more than 70% of the landlords have clearly expressed their willingness to moderately transform and rent out their properties, and nearly 40% of the landlords of old and idle properties are willing to invest more than 100,000 yuan in transformation funds.

On the demand side, the demand for improved rental housing among tenants continues to heat up. The "Blue Book" shows that about 80% of tenants are willing to rent for 5 to 6 years or even longer, and nearly 40% of tenants said they do not consider buying a house for the time being. The structure of the tenant population is changing from being mainly young people to being more diverse and older, and the trend of family-based rental is significant.

In 2025, for the institutionalized rental housing customer group, the proportion of tenants over 30 years old exceeded 50% for the first time. In terms of the composition of residents, the proportion of tenants living with family members such as partners, children, and parents exceeds 70%, far exceeding the group of individuals living alone or sharing with colleagues and friends.

Regarding the future market, the China Index Academy analysis believes that as the graduation season of national universities officially kicks off, the rental market will enter the window period of the traditional peak season. Driven by this, the domestic residential rental market will continue the structural market in the short term.

The peak of rental demand in core first and second-tier cities is coming, and the rent is expected to continue to rise steadily.

Data shows that the number of college graduates in the class of 2026 reached 12.7 million, a new record high. First-tier cities such as Beijing, Shanghai, Guangzhou, and Shenzhen, as well as strong second-tier cities such as Hangzhou, Chengdu, and Tianjin, will be the primary choices for college graduates to find jobs due to their complete industrial systems and sufficient job opportunities. The short-term rigid rental demand will be released intensively, and the rent of properties along industrial parks and rail transit lines will be strongly supported. The trend of rent recovery in cities will continue to be consolidated.

This article is from the WeChat public account "Meijing Real Estate". Author: Meijing Real Estate. Republished with permission from 36Kr.