Skyrocketing rents are pushing Shanghai's low-income group and new graduates out of housing options. Some of them are left with no choice but to find alternative ways to put a roof over their heads.

Ren Wenjiao, a 25-year-old postgraduate from the Shanghai International Studies University, is on the verge of talking her landlady into a deal where she won't have to pay a penny in rent.

Ren, an English-major, has proposed to offer free English lessons to her landlady in exchange for a 15-sq-m room in her three-bedroom apartment in the city's downtown Hongkou district.

"I don't have a rich father. I have just started my career so I don't have any savings. If I pay 1,500 yuan ($221) in rent every month, my life will be miserable in a city as expensive as Shanghai," said Ren, who fetches a pretax salary of about 4,000 yuan a month working in the media industry.

Ren plans to hold three two-hour English classes a week with her landlady. She said the deal would be "mutually beneficial" because she is charging a lot less than the market price of an English tutor.

"Sure, I can teach someone else English for cash, but teaching my landlady saves me the time of commuting and builds a bond between the two of us. That way she won't throw me out if the rent buoys up," she said.

The "skill-in-exchange-for-roof" practice is catching on among the city's fresh graduates and has become a hot topic on online communities and information platforms.

A software engineer, surnamed Lou, said at a popular consumer portal, kds.pchome.net, that he can "teach high school students physics, math and chemistry in exchange for a bedroom".

Apartment rents in downtown Shanghai have risen sharply since June, triggered by what experts call the shift of demand from buying second hand apartments to renting due to skyrocketing real-estate prices, graduates hitting the market and the ongoing Expo 2010 Shanghai.

According to the Shanghai Housing Price Index, old apartment buildings in the downtown area are the most sought after, with rents jumping 20 percent on average since January.

In some extreme cases, rents in some living quarters in Luwan and Jingan district jumped by 500 yuan in a single month in June.

However, experts have warned of the potential risk involved in the "skill-in-exchange-for-roof" practice.

"The practice is a new concept among the young," said Ma Ji, a senior manager with the research and information department of Centaline Property.

"There are lots of problems that could arise. The landlords may not be content with the quality of tutoring and can renege on their promises, as there are generally no contracts to govern the practice."