Failed government attempts to control housing prices have led to
the decline of public confidence in the measures, says a commentary
in China Youth Daily. An excerpt follows:
A recent online survey conducted by the social research center
of China Youth Daily shows that the public has less
confidence in measures adopted by the government to control high
housing prices. Compared with the findings two years ago when 58.9
percent of those surveyed were confident about government
macro-control on housing prices, the current percentage has dropped
to 20.6 percent.
The decline in public confidence stems from the difference
between the governments' targets and the public's expectations. The
central government pursues financial stability, regional government
aim to profit from land management while the public wants low
housing prices.
The central government has been taking measures to control
housing prices by increasing interest rates on loans, limiting the
land supply and adding taxes. These may curb speculation but cannot
decrease housing prices.
The central government requires regional governments to build
low-price housing and low-rent housing for low-income families. But
regional governments just want increasing profits from commercial
housing development, such as through land transfer fees and taxes.
The higher the housing prices, the more local governments profit
and the better their political achievements may look. Therefore,
regional governments have little interest in curbing housing prices
or in building low-rent housing.
It is no surprise that public confidence in governments housing
control is declining.
(China Daily January 25, 2007)