In our previous blog post, we talked about the latest regulation of medical beauty ads in China. It is crucial to understand the advertisement laws and regulations before launching any advertisements for your brand or business in China. The Chinese government has been regularly updating its advertising regulations to protect the legal rights and interests of buyers and to sustain market stability. Before promoting real estate projects in China, marketers have the obligation to fully understand the advertising laws and regulations and keep a close eye on them in case of any regulatory updates.  Failure to do so may result in hefty fines!

In this article, we will be sharing 3 principles that real estate developers and agents must abide by when promoting real estate projects in China for 2021 and beyond.

In China, parents are really concerned with their children’s education and future. If the family lives in a good school district, children are likely to enroll in the schools within the district. Proximity to good schools is a key consideration when it comes to buying a home. Therefore, a lot of real estate developers and agents use this as a feature of their project by making false claims like “Huge potential in real estate and education investments”, “School district houses”, “When your children graduate, you can sell your house for 3X what it worth now” and more. 

Such advertisements have fueled the drastic increase of housing prices.  Housing in China has become an object of speculation which has made it unattainable for first-time homebuyers. In 2016, the Chinese government revised regulations of real estate advertisements - conveying messages that school district houses can guarantee buyers’ children to enroll in specific schools are strictly forbidden. Yet, several real estate developers did not comply with the legislation and consequently were fined over ¥200,000 RMB (Approximately $31,000 USD). 

Real Estate developers and agents, if you want to promote your projects in China without getting fined, your advertisements must be authentic, legal, scientific, accurate, and without any misleading or false information. There are 3 principles that you must pay attention to:

1. Suggesting a guaranteed rise in value and investment is forbidden

2. Information that is against China’s government pricing regulations

3. Misleading advertisements and information regarding transport infrastructure, business, culture, and education amenities nearby 

Any terms related to investment growth must be avoided in your advertisements such as steady growth, value enhancement, infinite growth potential, earning rental income immediately after purchase, and more. Claims like “Steps away from public transport such as subway/airport/buses”, “Reaching a certain location in XX minutes” are also strictly prohibited. This is because depending on the walking speed, person A may take 5 minutes while person B may take 10 minutes to walk the same distance; this is why utilizing exact numbers such as this is categorized as misleading ad content.

If any real estate advertisement has violated one of the listed principles, it will be banned by the Market Supervision and Management department. Advertisers will be fined up to 3 times the advertising cost. If the advertising cost is too low or incalculable, advertisers will be fined up to  ¥200,000 RMB (Approximately $31,000 USD). 

If the advertisement violation is serious, advertisers might risk their business licenses and advertising review approval documents being revoked by the advertising review department. Their advertising review applications will not be accepted within one year and will be fined from ¥200,000 RMB to ¥1,000,000 RMB(Approximately $31,000 to $157,000 USD) based on severity. 

Note: This is not a complete guide for Chinese real estate advertising laws and regulations. To avoid running into any legal issues with your advertisements, you should always prioritize consumers’ rights, interests, and benefits by providing legitimate, authentic and accurate information. 

If you have any questions regarding marketing real estate projects in China, send us an email at info@catalystagents.com! Our marketing team will be happy to help!