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Who are complaining about high housing prices?

By Tong Dahuan
0 CommentsPrint E-mail China.org.cn, March 31, 2011
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The third group consists of urban residents whose children will live independently in the city. While these residents own their own homes, appreciation of their own property means nothing to them since the properties are just for their own use. Thus, this group faces a burden of helping their son or daughter purchase property in the city, since their children cannot afford a place on their own.

Generally, migrant workers can't be included in this group, as their salaries typically give them little chance of affording urban housing. Their incomes can, however, allow them to buy housing or build a home for their families in their hometowns.

As we can see, putting the three groups together clearly exceeds the 10 percent of the population who are non-homeowners. Therefore, some of the people complaining, amazingly, must be second or third-time homebuyers.

In response to complaints, there have been calls for the government to provide more "indemnificatory," or low-income housing, to residents as well as to take measures to artificially lower housing prices. However, we must take into consideration the possible consequences of these actions.

Prominent Chinese economist Steven N.S. Cheung argues that indemnificatory housing should not be the primary solution for lower-income residents. He worries these communities could go the way of Hong Kong's public housing in the 1950s and 60s, which became a haven for gangs, drugs and organized crime. Grouping large amounts of poor people together, Cheung argued, was the root of Hong Kong's problems.

Likewise, administratively lowering housing prices could potentially lead to many unexpected consequences, such as more unemployment and lower wealth effect.

The author is a social commentator in Beijing.

(This post was published in Chinese and translated by An Wei.)

Opinion articles reflect the views of their authors, not necessarily those of China.org.cn.

 

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