From the release of Chinese newspaper, the rate of application is ‘only 40% for first two public rental housing projects in Shanghai‘ (Soufun 2012 (1)). Has the China public rental housing project addressed sandwich-class housing problem? The current answer probably is no. This article is going to show you some brief review of public rental housing project in China.

 

Who is the target of public rental housing?

The fundamental interest of public rental housing is the protection of housing and housing market in China. The target group is sandwich-class, those migrant workers and people temporarily unable to buy housing.

What does mean sandwich-class?

Sandwich-class means people have no income with any savings. They can afford neither affordable housing nor commercial housing on the open market.

How is the occupancy rate of current public rental housing?

According to some report released on the newspaper, the occupancy rate of current public rental housing is not high as the expectation. For example, there is only 40% of application for the first two PRH projects which offer 5100 units to the market in Shanghai. Wuhan, the capital of Hubei province, offered the first public rental housing which had ‘913 units’ public rental housing to the market in the early of this year. There are only 210 units being taken so far’ (Soufun 2012 (2)).

Why do not have many people to apply well equipped public rental housing?

The most important reason is the unreasonable rent pricing. The public rental housing does not have the obvious prices competitive advantages which compare to the listing price of neighboring commercial rental housing on the open market. Many people hesitate to apply the equipped public rental housing might have other reasons, such as the strict application standard and inconvenient location of public rental housing.

 

Though the intention of public rental housing project is to cool down the country’s overheated real estate market, yet it might be unsuccessful due to some local officers who are the pricing decision-makers only see the cost of public rental or profit. They ignore the fundamental interest and objective of building public rental housing project in China. From the market research, the quality issue, the system of management and other problems will be occurred sooner or later. If local government did not make strategic plan to implement the project precisely, the public rental housing would not relief the dorms’ stress of migrant workers. It would be ridiculous to see so many vacant units of public rental housing on the one side and there are still huge of low income people without affordable housing on the other side in the current Chinese market.

Reference List:

Soufun 2012 (1), Shanghai PRH , [online]. Available at URL: http://news.gz.soufun.com/2012-04-01/7388826.htm [Accessed 17 May 2012].

Soufun 2012 (2), Wuhai PRH, [online]. Available at URL: http://news.nb.soufun.com/2012-06-13/7876150.htm [Accessed 17 Jun 2012].