China to start building 6m homes next year

PUBLISHED : Tuesday, 13 November, 2012, 12:00am
UPDATED : Tuesday, 13 November, 2012, 3:58am

China may start building as many as six million new government-subsidised flats next year, Housing Minister Jiang Weixin said.

The minister told reporters yesterday that the government aimed to complete no fewer than five million homes next year under a plan that was still being finalised. The building push is part of Beijing's five-year plan to build 36 million units of public housing by 2016.

The government started construction of 10 million homes last year and more than seven million so far this year. Jiang also reiterated pledges by Premier Wen Jiabao , saying the government would not loosen controls on the property market.

"At least for now, we don't have a plan to relax the controls," he said.

Li Huiyong, chief economist at Shanghai-based SWS Research, said Jiang's promise to maintain property curbs was in line with expectations.

"Any abrupt relaxation on property curbs would destroy the achievements the government has made so far with its macroeconomic controls," Li said. "Stability is the best choice."

New home prices on the mainland rose for the fifth consecutive month last month, inching up 0.17 per cent from September, according to a survey by an affiliate of the country's biggest property website, SouFun.

The increase comes despite the government's years-long effort to curb home purchases and tighten the land supply.

Construction of public housing projects is part of a government plan to improve living conditions for the poor, while cooling average property prices after the massive economic stimulus programme in 2008-09 that fuelled a surge in home market.

At the same time, Jiang said the government needed to handle "the heavy tasks" of building subways, schools and hospitals near the new housing projects.

The ministry was considering expanding a trial property tax programme, according to a Xinhua report. "We are studying it and may roll out a policy at an appropriate time," Jiang said.

Responding to a question raised by a reporter, Jiang said the ministry had discovered no major misuse of funding during the development of public housing so far, although there had been some construction quality issues.

The minister said the government would pay attention to any management shortcomings that arose in future.