If someone in China wanted to get an apartment a few years ago, he had to
wait for his work unit to assign him one, no matter how long it took. Today, he can just
buy or rent one on the market. This change came about as a result of the the fundamental
housing reform that is still going on in China. This reform, which aims to end
government distribution of apartments and make it possible for ordinary Chinese people to
buy affordable apartments, has made marked progress over the past two years, according to
Yu Zhengsheng, Minister of Construction. The reform involves a whole range of issues,
including housing subsidies and housing loans, selling out government-owned apartments,
supplying apartments for families with different levels of income, and improving the
housing market mechanism.
Housing Subsidy
The most drastic step the government has taken in the reform is to cease distributing
apartments to individuals, and give them housing subsidies instead. So far, 24 of the 35
large and medium-sized Chinese cities have worked out such plans. A few provinces like
Jiangsu, Shandong, Hebei, Guangdong, Hunan and Fujian, and Guangxi Zhuang Autonomous
Region have also started to implement the plans. Another program worth mentioning is the
Plan to Deepen the Housing System Reform in Beijing-Based Central Government Institutions,
which went into effect last August and is seen as an example for local governments in
implementing housing reform.
These changes have resulted in a significant increase in spending on housing by
ordinary Chinese people. In Suzhou, for instance, the local government handed out 44.78
million yuan in housing subsidies last year. The local residents, however, spent
425 million yuan buying apartments, which is about 9.5 times the subsidies.
Statistics show that as the housing reform moves on, ordinary people are increasingly
becoming the major buyers in the real estate market. About 70 percent of the apartments in
the real estate market are bought by individuals. In the coastal provinces of Jiangsu and
Guangdong, the rate is approaching 90 percent. |
