Realizing the dream of a place to live

• Source: Global Times
• [00:51 October 19 2009]
• Comments

No issue in China has produced more fury and sound bites than the property market.

Two issues in particular have engendered endless debate: accounting for the high price of real estate, and determining whether or not the poor are entitled to housing of their own.

The media has been abuzz with speculation that a second round of housing reform is imminent. Small wonder: The public outcry over soaring property prices has been to such a degree that another reform seems inevitable.

In China's first housing reform, housing welfare was gradually abandoned after 1998, and market rules were adapted to meet the enormous public demand for better living space.

While the market has indeed shown its power in stimulating supply, it has unfortunately also bred greed and corruption.

Many people now enjoy better housing conditions than before, but a sense of unfairness and loathing toward the powerful runs deep. The property market has become yet another arena for speculation, with bubbles growing.

One the one hand, the property market comprises a large share of the country's GDP and has fueled an economic boom this decade. The property sector is a large source of revenue for local governments and has made many developers wealthy.

But on the other hand, the trend has led to the "house slave" phenomenon: Average salary-earners become burdened with mortgages that are huge in proportion to their income, while housing prices continue to shoot upward.

Beyond economics, soaring housing prices have altered the social mores of this country, dominating housewives' conversation, becoming the sole ambition of young, talented people, and endangering the retirement life of the old, many of whom have to support their children by buying them an apartment with their lifelong savings.

Housing is more than an investment or a short-term usage commodity. A place holding people's memories and hope, a house gives ordinary people a sense of safety, forming the basis of social stability.

Having a place to live of one's own is a dream for nearly everyone, and governments worldwide have the obligation to help advance that dream, not profit from it. This is especially important for the government of a socialist country like China.

Regulating the property market has been called for in policy guidelines before, but unfortunately, these guidelines always seem to have been shaped according to industry interests.

The future of the housing market depends on how effectively local governments can be reigned in regarding their impulse to boost their revenues by selling land to developers.

The government has to recuse itself from being a player in the property market.

Otherwise, the housing market will continue to be a feast for local governments and developers, while having a place to live remains an expensive dream for ordinary people.