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China Daily Website

Available land can meet housing needs: official

Updated: 2013-03-24 08:12
By Zheng Yangpeng ( China Daily)

There has been no shortage of land in China for residential houses, and the land-supply plan for this year will be publicized no late than April, said a senior official on Saturday.

Hu Cunzhi, vice-minister of land and resources, made the statement at a summit held by China Development Research Center, a think tank under the State Council.

Hu denied claims that the Chinese government had supplied insufficient land for home building, thus limiting supply and pushing up home prices. He said almost 8.44 billion square meters of floor space could have been built on China's available land for residential houses over the past eight years, and if one person occupies 30 sq m on average, that space could house 281 million people.

During the same period, he said, 167 million people entered the cities, which means the available land has been adequate.

In the plan for the coming year, he said, "Local governments that could not meet the target would be urged to provide more. In general, the land supply for this year will not be lower than the average of the last five years."

The main reason for rising home prices in recent years, according to him, is speculation, which results in concentrated property ownership by a few wealthy investors.

"So we should continue to rein in the home speculators," he said. But he suggested that instead of administrative restrictions, a market-based adjustment, mainly in taxation, should be a future priority.

China in the past three years has adopted several housing market control policies, restricting the number of houses an average family could buy. The curb cooled the market for a time, before prices picked up again in the second half of 2012.

The latest curbing policy came on March 1, when the State Council announced that an income tax as high as 20 percent will be levied for homeowners who sell their homes. Prior to the new rules, the income tax levied was 1 to 2 percent of the sale price.

Hu said taxing the "home storage sector" would be more effective in repressing the speculative demand than levying taxes on transactions. The property tax however, should be levied on owners of three or more houses, he said, as one or two homes for every family is reasonable.

Ren Xingzhou, a researcher with the Development Research Center of the State Council, said that while supply in major cities like Beijing and Shenzhen was inadequate for the massive inflows of migrants, an oversupply of housing existed in cities such as Wenzhou and Ordos.

Future housing market regulation should be differentiated according to conditions in each specific market, Ren said.

zhengyangpeng@chinadaily.com.cn

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