China will invest more than 1.3 trillion yuan (US$200 billion) this year in affordable housing, a senior official said yesterday, as Beijing struggles to address mounting public concern over runaway property prices.
The government will use the money to build or renovate 10 million apartments for low-income households this year, Qi Ji (齊驥), vice minister of housing and urban-rural development, told reporters.
Governments at all levels will provide more than 500 billion yuan of the total investment, with the remaining funds to be raised from companies and families who will benefit from the program, he said at a news conference.
Authorities will introduce favorable policies such as loans, subsidies and tax incentives to support the construction of the apartments, he said.
“With the current financing channels and the support of new policies, I believe it is completely viable that we can accomplish the task of building 10 million low-income apartments,” Qi said.
However, state media have reported that the government fell short of last year’s target of building 5.8 million affordable dwellings.
China’s soaring property prices, combined with stubbornly high consumer prices in recent months, have become a source of anxiety for the public and top leaders, who are fearful of inflation’s potential to spark social unrest.
Chinese Premier Wen Jiabao (溫家寶), in a “state of the nation” speech to open the country’s annual parliamentary session on Saturday, vowed his government would work harder to address public concerns over a string of problems, including growing income disparity and surging house prices.
Wen repeated government promises to curb property speculation, which is blamed for stoking prices, and ensure an adequate supply of low-income housing.
Local officials who fail to stabilize property prices and promote the construction of low-income housing, and “thereby affect social development and stability,” will be held accountable, he said.
Qi said the government was focused on making sure those most in need had access to housing.
“The focus of our current adjustment and control policy is to postpone [the demand of] some consumers who do not need to buy houses immediately for living purposes,” he said.
“[We] intend to use the temporarily limited supply to meet the most urgent demand of consumers who need to buy housing for living purposes,” he said.
He said the government was closely monitoring the introduction of a property tax in Shanghai and Chongqing, adding that authorities would move forward based on experiences gathered from the trials in those cities.
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