Nature of Housing

by+Li+Zhuoxi

On March 5， 2017， Chinese Premier Li Keqiang stated that “we need to be clear that housing is for people to live in” in his Report on the Work of the Government. The direction of real estate market development was clarified at the Central Economic Work Conference held at the end of 2016， with a focus on accelerating its development towards stable and sound growth. Never in history had such a pointed expression been written in a Chinese government work report.

In 2016， the real estate boom calmed thanks to the governments strict regulatory policies. However， as stated in the government work report， at present， “there is still excess supply in the real estate markets of third- and fourth-tier cities.”The government will support both local and new residents in buying homes for personal use.

“We need to be clear that housing is for people to live in， and local governments should take primary responsibility in this respect. We should move faster to establish robust， long-term mechanisms to promote the steady and sound development of the real estate sector and build a better housing system that gives equal weight to buying and renting， with multiple levels of demand being met primarily by the market， and basic housing support provided by the government，”continued Premier Li.

By nature， housing is both accommodation and investment. Nevertheless， such an investment is by no means above regulation. Priority should be placed on residence over dividends. Investment prior to the residential function or that hinders the practice of this function will be considered opportunistic speculation.

It is also mentioned in the government work report that“several dozen million people still live in rundown areas of cities and towns. We must continue housing renovation in these areas.” In 2017， China will renovate another 6 million housing units in these areas， continue to develop public rental housing and other forms of gov- ernment-subsidized housing， base policies on local circumstances and use a variety of means to increase monetary compensation for those affected by construction， as well as improving local infrastructure and public services. All of these efforts will help more families struggling with housing escape rundown areas.