Is informal renting an affordable solution for affluent cities to help low-skilled migrants settle in destination cities? Evidence from Guangzhou, China

Although some valuable research has investigated the role of housing experience in shaping migrant settlement intentions, the literature on informal renting and settlement intentions has been surprisingly silent. As such, using survey data from Guangzhou, China, this study proposes a theoretical framework inspired by spatial assimilation theory and the housing career concept to investigate whether informal renting could be an affordable solution for affluent cities to help migrants settle in destination cities. The finding reveals a negative relationship between informal renting and long-term settlement intentions. Particularly, if low-skilled migrants have young children, informal renting would significantly weaken their intentions to settle in cities. Finally, informal renting might improve housing affordability but is unable to change housing tenure expectations from renting to owning or support permanent settlement. Despite this, the informal rental sector still plays an important role in China’s contemporary housing system for housing migrants. This study challenges the conventional thinking that encouraging migrants to buy a home helps them to stay long-term in destination cities. Unlike the unachievable goal of homeownership, renting is more achievable for low-skilled migrants. This study clearly suggests that the divergent roles of the informal and formal rental housing markets in cities may provide migrants with an additional permanent settlement channel when access to homeownership is not feasible.