China's toughest task: balancing real estate

• Source: Global Times
• [04:34 April 21 2010]
• Comments

European countries, through a process of trial and error, have found a solution in supplying more affordable housing, and offering policy support to renters. The US and Japan, on the other hand, serve to remind China of the disastrous economic consequences that can unfold when a property bubble bursts.

Regulating the property market is a long-term task for the Chinese government. Urbanization is still moving forward on a huge scale, and the country's income gap is widening. Even if the latest round of regulations succeeds in temporarily stabilizing property prices, it is really just the start of another tug-of-war between various stakeholders.

The rapid growth of property prices has increased the sense among ordinary people that they are getting an unfair deal. Much is riding on the property market, for both individuals and the entire country.

Given how much is at stake, it is no exaggeration to say that achieving balance in China's real estate market is the government's most difficult task.