China´s city governments compete to achieve or maintain importance in today’s globalised economy. Corresponding governmental strategies seek to attract and retain high-skilled Chinese return migrants, a group that is expected to stimulate and carry forward economic upgrading. The cities’ competition for those high-skilled return migrants is closely related to the development of high-tech development zones. In addition to industrial activities in the development zones, local governments create urban amenities by constructing specially designed living spaces as well as facilities in the development zones. Considering the tense housing situation in China, efforts to provide appealing and affordable housing solutions are considered a promising strategy for attracting high-skilled return migrants. Against this background, the article analyses, using the example of the two cities of Guangzhou and Dongguan (Pearl River Delta, China), two research questions: (1) What strategies do the municipal governments use to attract high-skilled return migrants – with what spatial consequences? (2) What are the most important factors and reasons for high-skilled return migrants when choosing their place of residence for resettlement? The empirical study uses a mixed methods analysis of government and media reports, secondary data as well as qualitative interviews with experts and high-skilled return migrants. Results show that despite the fact that both cities apply similar strategies to attract high-skilled return migrants, Guangzhou as a first-tier city remains more attractive to settle down permanently. The case of Dongguan’s Songshan Lake Science and Technology Industry Park provides relevant insights into a prevalent municipal strategy for attracting high-skilled return migrants by providing indemnificatory housing solutions. The strategy of providing dedicated housing estates can lead to a tendency towards spatial segregation. Further, the authors raise awareness to the importance of underlying demands and preferences in resettlement behaviour when trying to attract high-skilled return migrants permanently.