Urban Housing Policy Changes and Challenges in China

Abstract

Since the Communists came to power, housing provision in China has experienced several dramatic changes. Before 1949, the main tenure of housing in cities was private rental. This was changed through rent reform and nationalization in the 1950s, in which the majority of rental properties owned by big landlords were taken over by municipal governments. Public housing was built by government-owned enterprises and institutions and distributed directly to their employees as part of a comprehensive socialist welfare provision system. By the late 1980s, a public housing provision system was established in all urban areas. This system, however, encountered many problems, including severe shortage, lack of investment, unequal distribution, corruption, inefficient management and poor maintenance (Wang and Murie, 1996; Wang, 2007). To solve these problems, the government put forward new policies to reform the urban housing system. After several years of experimentation, comprehensive housing reform policies were implemented in the early 1990s. These policies aimed to commercialize the public housing provision system and re-establish an urban housing market. Arrangements were also made in the area of housing finance, mortgage lending and home insurance. Housebuilding was undertaken by commercial developers rather than by public sector employers. Over the last 15 years, the new urban housing market experienced many volatile booms and slowdowns.