Soaring real estate prices make it imperative for the government
to deliver the affordable housing it promised for low-income
families.
Official statistics show that the average price of new houses in
70 major Chinese cities rose 5.9 percent annually as of last
month.
Though the price increase was 0.2 of percentage point lower than
that of January, it does not amount to good news for low-income
would-be buyers, especially those in large cities.
Beijing, Shenzhen and Guangzhou all witnessed near double-digit
growth in housing prices in February. Meanwhile, Shanghai saw a
tentative rebound in housing prices, which had been falling for
months.
Given the importance of the real estate industry in boosting
economic growth and improving people's housing conditions, the
government should certainly try every means to promote the
industry's sustained and sound growth while getting the overheated
market under control.
The public's growing pain caused by rising housing prices also
demands close attention and prompt response from the
government.
When addressing the National People's Congress this month,
Premier Wen Jiabao said that the government will pay particular
attention to addressing the housing problems of low-income
families.
While stressing strengthened oversight and regulation of housing
prices to cool down the sector, the premier also promised more
fiscal and tax policy support to finance a sound system of low-rent
housing and increase the availability of affordable housing.
Clearly, these measures, if properly implemented, will be
crucial in improving housing conditions for low-income
families.
However, as housing prices shrug off the government's tightening
measures and keep surging, some local governments are dragging
their feet on taking responsibility for expanding the supply of
affordable housing.
For instance, a South China city's attempt to encourage
enterprises to build low-priced housing for their employees shows
failure of the local government to take responsibility. The
approach is bad not only because it will not provide real
low-income families with the affordable housing they need but also
because it tends to worsen income disparity.
Admittedly, it takes time to increase the supply of affordable
housing. Soaring housing prices only make it urgent for the
government to focus more efforts on the task.
(China Daily March 21, 2007)