More land opened up for affordable housing

China Daily, May 13, 2011

The supply of land for subsidized housing is increasing dramatically in 2011, the nation's land watchdog said.

An estimated area of 77,400 hectares is planned for government-subsidized housing projects, nearly 140 percent more than last year, Liao Yonglin, director of the land use and administration department at the Ministry of Land and Resources, said on Thursday.

The land supply for housing across the country is expected to reach 218,000 hectares in 2011, about 73 percent more than in 2010, with land for affordable housing projects taking up about 35 percent of the total supply, he added.

The central government pledged earlier this year to build 10 million units of government-subsidized houses in 2011 and 36 million units in total by 2015, as the country tightens the runaway property market.

"In order to curb the overheated real estate market, we increase the land supply, especially the land supply for affordable housing projects to meet the demand for 10 million affordable apartments," Liao said, adding about 40,000 hectares of land are needed for the affordable housing projects.

Liao asked the local land bureaus to monitor the land use. The deadline for adjustments to the land supply plan is before the end of June.

An accountability system was also launched to supervise the construction progress for affordable housing projects and how the land is used.

Owning a home has been a faraway dream for many people born in the 1980s, because of the soaring prices.

In March, the housing price in Beijing increased by 4.9 percent year-on-year and the average home price in the majority of the 70 large- and middle-sized cities in China continued to soar year-on-year, according to the latest statistics released by the National Bureau of Statistics.

Although a series of strict measures such as price caps, home purchase bans and tightening monetary policy have been taken, China's property developers are still high in enthusiasm with investment in real estate from January to April, exceeding 1.3 trillion yuan ($200 billion), a year-on-year increase of more than 34 percent.

Foreign investment in China's property market was booming during the first four months with more than 22 billion yuan invested, a year-on-year increase of 62 percent, according to the statistics.

Despite increasing home prices, Yan Jinming, a land management professor at the Renmin University of China, told China Daily on Thursday the real estate market is cooling as land supply increases and money flow tightens.

"The construction of affordable housing projects will indirectly influence the commercial housing market, because the home buyers will buy affordable homes instead," Yan said, adding that within several months the property market will gradually stabilize.