More action urged on housing aid abuses

The mainland needs to intensify a crackdown on abuses in its massive affordable housing schemes, industry observers say, even as it steps up efforts to build more homes for the poor in order to maintain social stability.

President Xi Jinping last week endorsed a plan by the former government to build 36 million affordable homes between 2011 and 2015 under a variety of schemes to accommodate families priced out of the real estate market by soaring prices.

The mainland finished building 4.1 million units in the first three quarters of this year, after building 5.9 million last year and 4.3 million in 2011.

While some observers are sceptical about the figures, mainlanders are more concerned about the misallocation of such homes, fearing taxpayers' money is helping to make rich families even richer in some cases and widening the wealth gap.

"The main issue is the low penalties for illegal conduct," said Wang Xiaopeng, a senior official at the China Real Estate Association, a government think tank. "The authorities must step up law establishment and enforcement."

A report by the National Audit Office showed that 108,400 unqualified families were granted affordable apartments or cash subsidies last year, and that 5.8 billion yuan (HK$7.3 billion) of funds designated for affordable housing funds were misused.

Media reports in the past few years have highlighted a number of people who owned good cars but were still allocated affordable homes, and others who rented out their units instead of living in them, as they are obliged to do.