Sources from the Ministry of Construction said they made plans
for a draft regulation on housing assurance, and the outline was
mapped out at a closed-door meeting last week. It is said the draft
will be completed and submitted to the State Council for approval
next year.
Xu Zongwei, Deputy Director of the Policy and Regulation
Department under the Ministry of Construction revealed during a
telephone interview with the 21st Century Business Herald
that the regulation would be drafted based on the principles and
guidelines stipulated in the August 13 circulation of the State
Council.
This circulation requires that by the end of the 11th Five-year Plan period (2006-2010), the
low-rent housing system be expanded to cover every urban low-income
household. The statistics show the number of such households
reached 10 million, accounting for 5.6 percent of the national
total. However, there is currently no clear definition of
"low-income" in relevant policies.
The ministry has recently promulgated Assurance Measures on
Low-rent Housing and Measures for Management of Economic Houses.
Unfortunately, the two measures don't touch on the problems of the
middle-income class. In other words, the management and financial
systems of economic houses, low-rent housing, and housing funds are
separated under the current policies.
Experts predict the upcoming regulation would not provide more
specific details than the existing two measures. The measures
clarify the coverage, assurance standards, and methods as well as
financial sources, while the regulation would define the
responsibilities of relevant governmental departments concerning
housing issues.
According to an official from the ministry, the government and
the market are the main elements influencing the housing issue. The
prices of commercial housing are determined by the market and the
government is responsible for low-income families. The
price-limited housing is aimed to curb soaring house prices and not
fit for the housing assurance system.
Recently, the Beijing municipal government announced that
families with an annual income lower than 27,000 yuan were
qualified for economic houses. The original bottom line was 60,000
yuan. Meanwhile, housing authorities are encouraging people to rent
rather than buy an apartment.
"The status quo of China's property market calls for a stable
policy on economic houses," said the official, adding that some
localities' successful experiences on economic houses would
probably be considered in drafting the regulation. The regulation
aims to cover just low-income families rather than middle- and
low-income ones.
According to Tang Jun, an expert in policy research involved in
the discussion on the new regulation, the policy on economic houses
still has a vague future. "However, the middle-income families
stand at the core of the housing issue," emphasized Tang.
Tang explained that President Hu Jintao only mentioned low-rent housing in
his report at the 17th Party Congress while said nothing about
economic houses. Recently, Premier Wen Jiabao also promised to develop a low-rent
housing system during his visit to Singapore.
The middle-income families account for 20 percent of the total.
Therefore, Tang called for the government to focus on economic
houses rather than low-rent housing. "The proper policy of economic
houses will compress the property market to business housing and
high-grade residences. The prices of commercial residences will
therefore slow down," he said.
Wu Xinmu, another expert in the field, doesn't agree with Tang.
Wu maintains that most people should rent an apartment. The
government should currently focus on construction of low-rent
houses provided for low-income earners, young people, public
servants, and farmer-turned workers. At the same time, the
government should strengthen supervision on economic houses and
relax controls on the commercial housing market.
Wu explained that such a strategy was determined by the slow
housing construction in the past decades. It is impossible to
fulfill everyone's housing demands in a short period.
The Ministry of Construction has started surveying urban
residents' housing situations together with drafting the assurance
regulation due to its tight schedule. Some localities, including
Shenzhen City, have completed the survey. Moreover, Shenzhen is
about to pass a local regulation to assure residents' housing.
Tang noted that the content of the national regulation would
most likely draw heavily from the Shenzhen one, since the latter
was drafted following the guidance of the ministry. Another expert
maintains that the national regulation might be more general,
"leaving management space for local governments."
(China.org.cn by Huang Shan, December 7, 2007)