The Chinese term "land king" - an appellation referring to the most expensive plot of land in a city - has been picking up traction over the past few months as developers in first- and second-tier cities continue shelling out ever larger sums for land. If land prices continue to climb, home costs will never go down.

Instead of pressing on prices, China's housing control curbs have consistently aimed at dampening demand or increasing taxation. Yet, even if home prices are not being inflated by speculators or investors, they may still be too expensive for most prospective buyers thanks to skyrocketing land prices. For instance, one property developer recently purchased a plot of land in Chengdu for more than 8,000 yuan ($1,304.21) per square meter. After factoring in construction and marketing expenses, a home on this plot could cost well over 16,000 yuan per square meter.

It's not possible to cool down housing prices without also trying to cool land prices. Authorities should scrap land transfer charges to lower home prices and levy long-term taxes on property owners.

The author is Liu Ke, a media personality.

Finance and Investment