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Booming real estate sector puts China at crossroads in 2010
(Xinhua)
Updated: 2010-03-02 10:49
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For China, from ordinary citizens to top policy makers, the phrase "real estate" brings a mixture of feelings. Strong investment in the sector has helped China recover quickly from the global financial crisis, but has also complicated China's economic future.
In the past year, investment has contributed eight percent to the nation's economic growth, compared with 4.6 percent from consumption and negative growth of 3.9 percent from exports, official data showed.
Fueled by a record bank lending and favorable tax breaks, home prices have surged since June last year, going beyond many people's reach and spurring fears of a bubble.
In an online survey about "the most important issues" to be discussed at the upcoming annual legislative, advisory sessions conducted by Xinhuanet.com, the web site run by Xinhua News Agency, 26,415 votes, or 69.8 percent went to housing prices as of 5 pm Sunday.
The "two sessions", or annual sessions of the National People's Congress (NPC), the top legislature, and the Chinese People's Political Consultative Conference (CPPCC), are due to begin in Beijing this week, focusing on the government's work programs for the year.
Pressure on citizens
In the first eleven months of 2009, China's average home prices reached 4600 yuan ($673.5) per square meter, up 27.8 percent from the same period in 2008.
"With such crazy conditions, owning a house can change your life. You can lose the one you love, or win her over but only to become a mortgage slave," said Zhou Jiantao, a white-collar worker in Shanghai.
Searching for a new flat for himself and his fiancee for more than a half year, he has become dismayed by the skyrocketing home prices in the city.
Even Premier Wen Jiabao mentioned the show during his an online chat with netizens Saturday.
Wen said he connected with the characters in "Dwelling Narrowness" as his five-member family once lived in a nine square meters room for quite a long time when he was a child.
"I really understand the complaints as housing prices in some cities have risen too fast," Wen said.
He expressed his determination to "rein in this wild-horse" and keep property prices at a reasonable level during his term as premier.
According to Wen, the government would step up efforts to increase the supply of affordable houses, encourage reasonable house buying while curbing speculative demand, and punish developers that hoard land and completed houses in anticipation of price increases.
