Commodification of housing with Chinese characteristics

Abstract

In its attempt to reform the housing system, China has rapidly marketized but not privatized the housing production process and system. In contrast, the consumption of housing is privatized quickly but marketized slowly. Yet, the housing allocation process still largely relies on the old system of heavy subsidization. Nonetheless, housing subsidy has been curtailed and the growth in home ownership and the future pegging of rent and price with household income would dwarf the housing provider role of the government. The commodification process necessitated new government roles since government support in infrastructure and superstructure is essential for the healthy functioning of the newly emerged housing market. Overall, retention of the public ownership of the development companies and the housing financiers differentiate the Chinese housing reform process from those of other market and post-socialist economies.