context: The Civil Code addresses housing security issues such as tenants' rights and the unique needs of an aging population. Solutions to these issues must be balanced with the need for real estate investment in economic recovery following COVID-19.
The Civil Code has added a new right, the right of residency, to its Property Rights chapter. Originating in Ancient Roman law, it confers the right to possess and use all or part of another's house or facilities.
Differences between the right of residency and house leasing are
- nature of right
- right of residency: an independent usufructuary right
- house leasing: a creditor's right
- can only counter against specific debtors
- effectiveness
- right of residency: comes into effect upon registration
- housing leasing: not subject to registration
- acquisition
- right of residency: free in principle
- house leasing: requires rent payments
- term
- right of residency: no limit
- house leasing: maximum of 20 years
A right of residency was introduced to improve housing security system, by
- resolving issues of illegal applications and speculation in security housing field
- rightsholders of residency can claim remedy from a third party as holders of right in rem
There are strict conditions for establishment of right of residency
- based on a written contract or will
- registration
- barring transfer and inheritance
- barring rented unless agreed
- right termination
- expiration
- rightsholders’ death
- registration cancellation
- house owners having full control after going through formalities
It increases flexibility of the system and can meet people's requirements for diversified use of property by
- assisting allocate houses’ value in joint construction or purchase of houses
- promoting real estate investment styles such as timeshare hotels and serviced apartments
It helps to protect housing rights of vulnerable groups, namely
- disadvantaged party in divorce cases
- elderly living alone
Issues that need to be further clarified by legal interpretation include
- newly established right of residency
- hukou settlement rights
- school enrollment rights
- conflicts between right of residency and security interest
- whether right of residency can be divided, shared, revoked