Strong public rental housing pro­gram can curb realty prices

China Daily (Hong Kong) - - VIEWS -

Years of ris­ing housing prices have made China’s real es­tate sec­tor anath­ema to many young peo­ple and a butt of jokes on many on­line and so­cial me­dia plat­forms. In response to public ap­peals to sta­bi­lize housing prices, the gov­ern­ment has launched many price and trans­ac­tion con­trol mea­sures. And the lat­est data show real es­tate prices have stopped ris­ing in some ma­jor cities; in Bei­jing, for in­stance, they have even dropped mildly.

No doubt, such ad­min­is­tra­tive mea­sures do yield tem­po­rary re­sults. But over­all, realty prices in China have surged in the past decade, with those in some ma­jor cities in­creas­ing more than ten­fold. This strong surge in prices has made many doubt the sin­cer­ity of pol­i­cy­mak­ers in cool­ing the real es­tate mar­ket.

So pol­i­cy­mak­ers have to rethink their short-term de­mand-re­press­ing strat­egy and find a more ef­fec­tive way to sta­bi­lize the real es­tate mar­ket. Per­haps, as last year’s tone-set­ting Cen­tral Eco­nomic Work Con­fer­ence said, China should put in place a “long-term mech­a­nism” to ef­fec­tively man­age the mar­ket. Such a mech­a­nism would in­clude in­creas­ing land sup­ply, sta­bi­liz­ing money sup­ply, re­form­ing the real es­tate tax sys­tem, and de­vel­op­ing public rental housing.

China has achieved some head­way on those fronts. For ex­am­ple, the growth of money sup­ply, mea­sured by M2, dropped to 9.6 per­cent in May, one of the low­est lev­els in re­cent years. The gov­ern­ment is also mulling im­pos­ing tax on peo­ple who own more than one house.

How­ever, China still lacks a sound public rental housing sys­tem that can pro­vide ac­com­mo­da­tion for low-in­come peo­ple who can­not af­ford high-rental com­mer­cial housing.

Newspapers in English

Newspapers from China

© PressReader. All rights reserved.