The end of ‘toleration’? Policy ambiguity and converted-housing occupancy in China

Abstract

An uncommon ‘homeowner’ protest in Shanghai in 2017 manifested public anger towards a government crackdown on commercial property converted apartments (CPCAs). Spotlighting this previously hidden but significant Chinese housing submarket, the episode highlighted ‘homeowner’ concerns over insecure property rights. Internationally, commercial-to-residential conversion is nothing new. Indeed, it has been championed as a contributor to addressing housing shortage. How has an internationally well-established practice generated such tensions in China? Focusing on the Shanghai case, this paper analyzes the processes involved in commercial-to-residential apartment conversion by examining interactions between state, market players and ‘homebuyers’, drawing on discourse and policy analysis. Reflecting consideration for short-term gains and conflict avoidance, state regulations were historically vague and open to interpretation. Non-government stakeholder behaviour was underpinned by hopes that legitimacy of residential use would be subsequently confirmed. The 2017 ‘policy clarification’ has placed CPCA owners at risk of major financial losses and possibly even homelessness. Historic policy ambiguity and erratic enforcement stored-up trouble for the future.