In 1998, China’s government ended direct housing distribution to employees through the employer-based system and introduced a Housing Fund (a saving plan contributed by employers and employees for housing purposes to help employees buy a house with subsidized loans). Low-rent public housing is provided by the government for low-income urban households, while commercial housing is provided by the market to meet the needs and demands of high-income families.
Affordable housing in China, as known as “economical and comfortable housing," is available for to middle- to low-income people. The central government sets policies for affordable housing, then local governments are required to provide free land (land in China is state-owned), and reduce government charges and fees to lower the housing price.
The housing prices have been skyrocketing for years especially in big cities like Beijing. Average price could be as high as $1500 per square foot which is even unaffordable for average salary earners. Thus there’s a series of challenges for the current affordable housing program. Such as inadequate affordable housing, the affordable housing only accounts for a small portion of the total housing market, while people with low- and mid-income accounts for most of the population. Besides, the growing population brings a growing demand for affordable housing, especially there are more and more people swarm into cities. Moreover, inappropriate restrictions, like only people who are permanent residents of the city are eligible to purchase housing in that city.
The government needs to make efforts to deal with the economical and comfortable housing issue in order to build the harmonious society that they advocate.
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