Public Rental Housing is a key scheme pioneered by Chongqing to provide affordable homes for the middle to lower income groups. The mainland has been providing cheap homes for the less well-off, but this is the first time that government-subsidised accommodation has been offered to the middle to lower income households.
The move demonstrates Chongqing's determination to improve the livelihood of its people and its efficiency in carrying out reforms.
The plan was announced 11 months ago, and the first residents started moving into their new flats last month.
Under the plan, Chongqing agreed to build 13 million square metres of Public Rental Housing each year from 2010 to 2012. The goal is to provide 40 million square metres of housing for 2 million people in three to four years. The housing will be located in 21 new residential districts in different parts of the city along the second ring road, or outskirts of the city.
Within the residential districts there will be supporting facilities such as schools, hospitals, shopping centres, public squares, sports grounds and green areas.
The 21 residential districts will be served by 18 new monorail lines, connecting the districts with the city proper. The housing has a plot ratio of 3.5 to 4.0, and greenery of about 35 per cent.
Public Rental Housing targets families with a living area of less than 13 square metres per member. It also targets migrant workers, mainly farmers in rural areas who come to the city; new university and college graduates; and people from other parts of the mainland who come to work in Chongqing.
The flats are available in five different sizes: 31.14 square metres (open type), 47.11 square metres (one bedroom), 59.81 square metres (two bedrooms), 58.60 square metres (two bedrooms) and 79.35 square metres (three bedrooms). All the flats are equipped with basic furniture and electric appliances.
The rent is set at about 60 per cent of market price. For the first housing district, Minxin Jiayuan, the monthly rent is about 300 yuan (HK$358.7) for a 30-square-metre flat, or 600 yuan for a 60-square-metre flat. This is about 10 per cent of household income.
Residents who have lived in their flats for three to five years can purchase the flat, partially or wholly, if they fulfil certain conditions. Those who have bought the flat can also sell it, but only to the administration office, which will buy flats based on the purchase price plus interest, and then reallocate them to new applicants.
The first ballot for Public Rental Housing was held on March 2. The ballot attracted 22,317 household applicants, and 15,281 units were allocated, or a successful rate of 68.5 per cent.
Despite its overwhelming success, there are concerns that the project may be subject to abuse because there is no upper-income ceiling for applicants.
Huang Qifan, mayor of Chongqing Municipality, says there is no need to worry about abuse because unlike commercial properties, there is no second-hand market for the public rental houses. 'Although people can sell their flats to the management committee after five years, they can only protect the value of their flats instead of making money out of the sale,' he says. 'Since we have closed the back door, we don't mind opening the front door wider.'