85% of Chinese families can't afford houses

15:56, December 08, 2009      

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According to Chinese Academy of Social Sciences (CASS), 85 percent of Chinese families can not afford housing expenditure, and house prices are much higher than their incomes. The situation was pointed out in the Blue Paper on Analysis and Prediction of Chinese Economics in 2010 issued by CASS Dec. 7, 2009.

The Blue Paper says that house prices are 3 to 6 times greater than people's incomes; therefore it will be very difficult to buy a house for citizens. Furthermore, the average ratio of house prices to incomes in China, 2009 will be 8.3, well beyond the scope of reasonable affordability.

In fact, it will be 22.08 for migrant workers and 29.44 for farmers in 2009. Because of this, 85 percent of Chinese families do not have the ability to buy their own future houses.

To restrain house price increases, the government has to protect low income people both in cities and rural area with a social security system, not just leaving them vulnerable to market forces. For middle-income people, assuring their right of abode, meaning each can rent a house, is the most important; at the same time, it should be a market operation under a s