CHINA TO INCREASE SUPPLY OF AFFORDABLE HOUSING

By Vincent Low Seng Guan

BEIJING, Jan 14 (Bernama) -- China will build six million affordable housing
units to meet public demand and implement a stricter housing loan policy to curb
property speculation which has resulted in a house price surge in major cities.

"We will increase the supply of affordable housing, which includes low and
medium-cost apartments as well as low rental public housing in areas where
house prices are very high," Housing and Urban-Rural Development Deputy Minister
Qi Ji told a press conference Wednesday at the State Council Information Office.


He said the government had to put into consideration the housing need of
college graduates and the floating population who moved to the cities for jobs.

"By increasing the supply of public rental houses and other
government-subsidised houses, we would be able to solve housing difficulties of
these people in the short term."

Asked whether there was a bubble in China's property market, Qi said: "We
are aware of the fact that in most of the coastal cities, the prices of
commercial housing are obviously too high but it is partly supported by
consumers.

"However, it is our goal to increase the supply of low and medium-cost
housing to meet the demand of low and medium-income families," he said.

"According to the spirit of the State Council's circular, housing should
first and foremost meet the basic living neccessity or function.

"Therefore, various authorities must act in strict accordance with the
credit policy for second home buyer and for those who buy houses for speculation
purposes," he added.

Meanwhile, Bank Regulatory Commission Deputy Director Wang ZhaoXing said a
purchaser would be required to pay no less than 40 per cent downpayment for a
second house and the relevant authourity also had to conduct a comprehensive
investigation on the income and repayment record of a loan applicant.

"Through these measures we would have an effective control over property
developers, property speculation and possible fraud in morgage application," he
said.
-- BERNAMA