China's Urban Housing Reform: Recent Achievements and New Inequities

Abstract

China's urban housing reform started in the early 1980s, as a part of comprehensive economic reform. The old system was dominated by work units that provided substantial in-kind services to their employees, including heavily subsidised housing. It brought three serious problems: housing shortages, corruption and inequities. The goals of housing reform were to solve these problems through urban housing privatisation, commercialisation and socialisation. This study examines China's urban housing reform through a case study of the city of Jinan. It first reviews the history of housing development in Jinan from the 1950s to the 1980s, and then analyses Jinan's reform practices in the 1990s. Its finding is that, after many years' efforts, housing reform in Jinan has made substantial progress, but mostly with respect to privatisation. The problem of housing shortages has been addressed and crowding has lessened considerably. Anecdotal evidence suggests that corruption is less widespread than in the past. The other important housing problem, inequity, still exists and, in some respects, has even worsened. In particular, a new form of horizontal inequity has arisen due to the persistent role of work units in housing provision. This paper suggests that, in the future, the government should take a more positive role rather than leaving the market alone to deal with the problem of housing inequity.