Playing the divorce game for a second home: China Daily columnist

A couple embrace as they watch the view from the Oriental Pearl Tower in Shanghai on Sept 8, 2016.
A couple embrace as they watch the view from the Oriental Pearl Tower in Shanghai on Sept 8, 2016. PHOTO: AFP

By Li Fangchao

China Daily/Asia News Network

The divorce sections of Shanghai's marriage registration office are witnessing a bizarre phenomenon.

Instead of a hall with a solemn, if not depressing, atmosphere the divorce sections look more like bustling markets. Some branches of the city's marriage registration office, which usually receive a dozen or so couples a day, have had to impose a daily quota to limit the number of couples filing for divorce to ease employees' workload.

People waiting in long queues range from elderly couples married for many years to newlyweds. The reason for the sudden surge in the number of couples seeking to end their marriage is not the breaking of the conjugal bond but a rumour that city authorities are set to tighten the housing policy, which will treat couples who divorced less than a year ago as a family when it comes to buying a house.

According to the existing policy, a family in Shanghai can buy a maximum of two houses, and one that already owns a house has to shell out 50 percent of the price of the second one it wants to buy as down payment. The down payment for first-home buyers is only 20 percent.

The rumour has fuelled the frenzy of Shanghai couples seeking divorce, because they fear buying a second house, let alone a third, will become more difficult, if not impossible. And they know that the constantly rising housing prices in first-tier cities such as Shanghai and Beijing means a house will cost much more if one is forced to wait for a year.

But even before the rumour spread, many couples reportedly bypassed the restriction by getting a divorce and registering their house under the name of one of them, which made the other a first-time home buyer. And after sealing the deal for a second house at lower down payment and preferential interest rate, the couples got back together. Though the practice is not illegal, it is a pity that so many couples made a mockery of their marriage for economic gains.

This "Chinese-style sham divorce" is a vivid reflection of the sizzling hot property market in major cities, which forces couples to sacrifice morality and family values on the altar for monetary gain. The reason why many couples indulge in such demeaning behaviour is that they believe buying property is the best investment given the lack of other investment channels.

The often double-digit annual growth in housing prices in major Chinese cities has caused a huge wealth gap between families that bought a house, say, five years ago and those who want to buy one now. The skyrocketing housing prices have far outpaced the growth in ordinary people's incomes. So buying a house remains the best way to counter inflation and increase a family's assets.

Nevertheless, the "strategy" employed by such couples is fraught with risks as the "fake divorce" could become real. Some media reports say a man in Shanghai took his former wife to court for refusing to remarry him after they divorced with the aim of buying a second house for a lower down payment and interest rate.

But the man cannot do much, because legally they are divorced and their first house has already been registered under the name of his wife according to the divorce agreement. Still, the case has not dampened many couples' frenzy to seek a divorce in order to buy a second house as they believe their bond can stand the test.

This suggests so long as housing prices continue to rise rapidly, the "fake divorce" phenomenon will go on unabated.