Opinion / You Nuo
Longer-term solutions are required
By You Nuo (China Daily)
Updated: 2006-06-05 05:42
For quite some time now, the problems in the real estate market, and the
complaints about them, have occupied much space in the Chinese press.
They gave rise to the "eight points" guidelines for regulating the market
issued by the State Council, China's cabinet, in the middle of last year,
followed by the State Council's "six points" in mid-May this year, then
followed by the "15 points" last week, jointly signed by a number of key
central government agencies.
No doubt these guidelines will do their bit to dampen the rapidly growing
enthusiasm for property investment and stabilize housing prices in major
cities.
Restrictions will be heavy for certain buyers of certain types of
housing, particularly those who expect to turn property ownership into a
kind of investment by buying large units and renting them to expatriate
tenants working for multinational corporations.
Their purchasing plans are identified as the major factor driving up
housing prices.
At the same time, developers are required to build more small units,
which will have to be no less than 70 per cent of their total offerings.
The supply of small units is likely, as a result, to see an increase over
the next six months, and this enlarged supply will probably help
stabilize overall housing prices.
These are necessary moves to cool down a market driven by unbridled
growth and perhaps waste. A relatively quiet real estate industry will
help China rein in its overall GDP growth for the year by reducing the
demand for some key production materials.
But these are all policies to bring about short-term assistance. Housing
problems, especially in large cities like Beijing and Shanghai, have some
deeper-level significance and require policies featuring greater
foresight and long-term benefits.
First of all, the current attempt to slow down real estate investment
cannot be, as some commentators in the Chinese-language press seem to
suggest, a war between the government acting on behalf of the public
interest and unruly property developers.
Those merchants may not be particularly attractive personalities. Nor
does their industry have much to boast about in technological progress or
managerial expertise.
But they are the ones that happen to operate in a market that generates
more economic growth and consumer spending than many other things can do
especially at the stage when every Chinese household is looking for ways
to improve its housing conditions.
It is not right, of course, for property developers to hijack public
policies because of their importance by doing whatever brings them the
highest returns. But those who make policies should also do more to
define the role of the business.
However, for quite long and longer than the time that officials have been
busy with such details as the size of houses and their maximum prices
some more important questions have remained unanswered.
Should, for instance, Chinese cities have a distinctive division between
rich people's living quarters and those belonging to the rest of society?
Some developers said yes. While their critics, arguing from a moralistic
standpoint, said no.
But if in reality, there are customers who aspire for larger units,
whether for investment or for their own use, where should those houses
be? Should they occupy locations best equipped with public facilities,
which I tend to think belong to average homeowners, or should they be
built in some distant spots?
At the same time, should cities like Beijing and Shanghai consider moving
some of their cities' functions to new cities in nearby provinces? Why
should they, for instance, keep so many crammed university campuses in
their cities? After all, they have little room to develop.
Why must every corporation keep its headquarters, along with a whole army
of supporting staff, in a major city in order to claim national
importance?
Why, in the era of the Internet and mass communications, must every media
organization keep its general office in downtown to advertise its
presence?
Again, there is the question I raised one year ago when I started this
column, why would any rational person want to work in Beijing's central
business district? The traffic jam has never relaxed a bit since I worked
there for an investment firm in 2000. No improvement in six years, what
development is that?
Email: younuo@chinadaily.com.cn
(China Daily 06/05/2006 page4)
Hot Talks
� Share Our Crafts: Naming contest
� The microprints of 1980s Shanghai
� The ceremony at the White House
� Do teenagers really need mobiles?
� China's Serious Environment Problem
Most Commented/Read Stories in 48 Hours
Alibaba is the largest B2B marketplace in the world. Source model ship,
wooden puzzle, one-piece toilet, RC hovercraft, photo album, prom dress,
pocket bike, Vaginal Speculum, Samurai Sword, String Panty and PVC Pipe.
Learn Chinese, Learn Mandarin online, Learning Materials, Mandarin audio lessons, Chinese writing lessons, Chinese vocabulary lists, About chinese characters, News in Chinese, Go to China, Travel to China, Study in China, Teach in China, Dictionaries, Learn Chinese Painting, Your name in Chinese, Chinese calligraphy, Chinese songs, Chinese proverbs, Chinese poetry, Chinese tattoo, Beijing 2008 Olympics, Mandarin Phrasebook, Chinese editor, Pinyin editor, China Travel, Travel to Beijing, Travel to Tibet
No comments:
Post a Comment