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NPC & CPPCC Annual Sessions > Biz & Economy > News
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'Low-rent housing key to help poor'By Zhao Xu (China Daily)
Updated: 2009-03-05 10:09 The key to solving the urgent problem of accommodating a large number of low-income urban residents is to build low-rent houses, a real estate giant told policymakers yesterday.
Known as the brain behind the birth of Shanghai's Xintiandi, a 20,000-sq-m development project that has transformed the backwaters of the metropolis into a flashy address, Lo said if the country is serious about helping its poor, "low-rent housing is the only answer". "Real estate developers in Hong Kong are attuned to high-profile projects, and won't have much role to play in the construction of low-rent housing in the mainland. But they could at least offer valuable suggestions regarding the design of the structures," Lo said. Low-rent houses are "very different" from the regular residences, he said. "Their design is far more compact and space-efficient. And Hong Kong is an expert at building such houses." The real estate tycoon, who is a deputy to the CPPCC, made the remarks when asked if the property prices in major Chinese cities were still "unreasonably high". The mainland housing market entered dormancy since the beginning of the current economic crisis, but a dramatic slash of price - widely expected - hasn't materialized yet. "Let's not confuse the two issues of providing affordable housing to low-income residents, and stimulating the economy," Lo said. "Every country has about 20 percent of its population unable to buy property. No matter how much we lower the price, they still won't be able to afford it. It is the government's responsibility to provide them with accommodation," he said. "Low-rent housing will ensure, that a resident, whose income exceeds a certain limit, must vacate the house to make way for those in need." He assured that a significant dip in property prices was "highly unlikely". "Those (real estate developers) who have cut prices know their projects are generally of low quality, or are situated too far away for comfort," he said. "The price they quoted first was anyway too high." The past few months have seen various local governments taking a series of measures to boost the ailing housing market. The Beijing Municipal Government in January overturned an order, which restricted property purchases in the city by foreigners. It also relaxed a restriction, in force since 2007, on banks lending money to homebuyers. "Under the current economic situation, foreigners have become extremely cautious about buying properties in an unfamiliar market, even if given the opportunity," Lo said. "The government should let the market tend to itself. " Lo's fellow CPPCC deputy Tong Shijun, a senior economist from Hainan, said: "Property prices in China are determined by a multitude of factors, including land costs, tender terms and taxes. It is unfair to ask a developer to cut the prices if he cannot find a way to cut costs."
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