China to Firmly Curb Excessive Rise of Housing Prices in Cities

The Chinese government will firmly curb the excessively rapid rise of housing prices in some cities this year, Premier Wen Jiabao said Saturday, voicing the determination to cool the red-hot property market.

The government aims to "genuinely stabilize housing prices and meet the reasonable demands of residents for housing", Wen said when delivering a government report to open annual session of the National People's Congress (NPC), the top legislature.

"We will further implement and improve policies for regulating the real estate market and firmly curb the excessively rapid rise of housing prices in some cities," Wen said.

He said the government will formulate and announce an annual housing development plan, designate sites for building low-income housing when planning for new construction projects, and make sure that all designated sites are used to develop low-income housing.

Total number of units of new low-income housing and units in run-down areas that will undergo renovation will reach 10 million, and 1.5 million dilapidated rural houses will be renovated, Wen said.

Emphasis will be placed on building more ordinary small and medium-sized commodity housing units.

The government will also give priority to developing public rental housing, with allocation of 103 billion yuan (US$15.6 billion) in this year's budget for subsidies to support the work, an increase of 26.5 billion yuan over last year.

The premier said governments at all levels will be asked to raise funds through various channels and substantially increase spending in these areas.

According to a draft plan for next five years' development, which was released Saturday to national lawmakers for reviewing, China aims to build 36 million low-income housing during the 2011-2015 period, raising the proportion of affordable homes to 20 percent of China's total supply by 2015.

The share was around 8 percent last year, according to the Real Estate Research Institute of Tsinghua University.

Wen said the government will strictly implement differentiated housing credit and tax policies and tighten tax collection, and effectively curb speculative and investment purchases of housing.

He also requested local governments to shoulder direct responsibility for stabilizing housing prices and guaranteeing the availability of low-income housing.

Officials will be held accountable if they put insufficient effort into stabilizing housing prices and promoting the construction of low-income housing and thereby affect social development and stability, he said.