Housing policy looks to aid new urban residents

China will not turn to the property sector for short-term impetus to stimulate economic growth this year, and will instead ratchet up efforts to address housing difficulties faced by new urban residents and young people, officials and experts said.

They made the remarks following the annual Central Economic Work Conference in early December, which set out China's economic policy agenda for this year.

Reiterating the principle that "housing is for living in, not for speculation", a statement issued after the meeting stressed that China will encourage both the purchasing and renting of housing.

Aside from accelerating efforts to develop a long-term rental housing market, China will strive to initiate more government-subsidized affordable housing projects. The country will also roll out measures to support the property market so that it better caters to reasonable demand from homebuyers.

"China will not use the property sector as a tool to stimulate short-term economic growth," Minister of Housing and Urban-Rural Development Wang Menghui told Xinhua News Agency.

He said that against the backdrop of China's ongoing, rapid urbanization process, the country will intensify efforts to meet the housing needs of new urban residents and young people.

Permanent urban residents now comprise 63.9 percent of the population, and the percentage is still increasing rapidly, he said. With an annual increase of over 11 million in the number of employed urban residents, the emerging housing demand in the country is huge.

"To meet the housing demand of new urban residents and young people, the country will strengthen its policy support in finance, land and public services," Wang said.

While vigorously promoting the development of government-subsidized rental housing, Wang said the government will carry out measures tailored to local conditions to develop shared-ownership housing and accelerate the development of long-term rental housing.

The country will also ramp up endeavors to synergize regulatory policies on finance, land and market supervision as it strives to keep market expectations and the prices of land and housing stable, he said, adding that tailored guidance will be offered to different cities as the ministry forges ahead with the work.

In a statement issued after its annual work conference in late December, the People's Bank of China, the country's central bank, said that to meet reasonable demand from homebuyers and ensure the healthy development of the property sector, it will implement a prudential supervision system for property finance.

Zhao Xiuchi, a professor at Capital University of Economics and Business in Beijing, said the housing policy mapped out in the Central Economic Work Conference is tailor-made to address emerging changes in housing demand.

Stimulated by increases in people's incomes and the easing of family planning restrictions, people are still very willing to buy new houses in China despite high prices, she told China Youth Daily. While some people do not yet own houses, others want to buy larger ones of better quality.

Zhao said that makes it necessary to adjust the country's regulatory policy on the property sector to make differentiated responses to diverse needs and different situations in different cities. The policy should give more preferential treatment to first-time homebuyers and upgraders.

For some residents, however, it's currently more cost-effective to rent a home than to buy one.

Aside from increasing the supply of new rental housing, she also suggested that the government transform inefficiently used properties－including some commercial buildings－to meet rental demand.