Vice-Minister of Construction Liu Zhifeng has urged property
developers to build more affordable housing to satisfy the needs of
low to medium-income families.
"Their need for housing is still a concern because the trend for
real estate developers has been to build bigger apartments," Liu
pointed out in a written statement read out at the China Property
Industry Analysis and Forecast Summit which was held on August 25
in Shanghai.
"But many families cannot afford these," Liu added.
Liu described an apartment with a land area of more than 120
square meters as a "spacious house" and said that nearly half of
the apartments for sale in 16 major Chinese cities would fall into
this category.
In nine cities out of the 16 mentioned, apartments bigger than
the benchmark 120 square meters account for 60 percent of the
properties for sale. In one city, which Liu did not name, nearly
half of the apartments and houses for sale are larger than 180
square meters.
Conversely, less than 10 percent of apartments for sale are
below 80 square meters in the 16 cities.
A real estate insider said China, with its population of 1.3
billion, cannot provide spacious homes for every family due to land
constraints.
"What's more, the cost of such accommodation is beyond people's
purchasing power," Liu said.
Liu said the demand for smaller and more affordable housing is
rising.
A survey in Shenyang, an industrial hub of northeast China,
showed that nearly 16 percent of homebuyers want apartments smaller
than 60 square meters, but only 2.6 percent of those for sale are
below that size.
By contrast, only 2 percent of buyers can afford housing larger
than 150 square meters, but nearly 35 percent of the houses in the
city's real estate market are 150 square meters and bigger.
The survey also showed that most prospective homebuyers want to
buy houses ranging from 60 to 100 square meters.
For urban Chinese, the average living space is 28 square
meters.
Liu said that urban construction monitoring bodies at various
levels should step up their efforts to determine homebuyers' needs
and demands.
Last Friday, Minister of National Development and Reform
Commission Ma Kai stressed that the government will support the
building of more affordable housing and continue to curb rising
real estate prices.
Ma said investment in property had grown 23.5 percent by July,
after the government imposed much stricter regulations to the real
estate sector.
Liu said the government would not be introducing new policies,
in the remaining months of the year, to cool down the property
market.
A senior policy researcher with the construction ministry said
about 1 trillion yuan (US$124 billion), nearly one-10th of the
value of China's total economic output in 2004, was invested in the
property sector last year.
"Nearly 20-30 percent of these investments have become bad
assets and the situation is getting serious," Wang Yulin, deputy
director of the ministry's Policy Research Center, said.
(China Daily August 29, 2005)