Renters' Housing Behaviour in Transitional Urban China

Abstract

This paper aims to understand how renters make their housing decisions in urban China, where market mechanisms are being introduced into a previously welfare-oriented housing system. It is argued that while renters now enjoy more housing options, their choices are constrained not only by socio-economic factors as is the case in the West, but also by persisting socialist institutions such as the hukou system and work units. Using a national survey carried out in 1996 and a technique of multi-level modelling, the empirical study suggests that while private housing is becoming an important option, renters who can access public housing are still more likely to choose public housing because of heavy subsidies. Yet, renters with rural and temporary hukou, and those working in low-ranking work units are at a disadvantage in the housing market. In general they do not qualify for public housing, and private housing is their only option. Although the socialist housing system is under reform, it still defines renters' housing access and thus shapes their behaviour in the late 1990s.