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High House Prices Have Taken over China’s Entire National Economy

On February 3, 2013, in his personal blog on the website of Caijing Magazine, a business and finance magazine in Beijing, a professor of economics published an article about the problem of China’s high housing prices. According to the article, the Chinese government is responsible for the high housing prices in China. Many large state-owned enterprises, rather than upgrading their products, have been rushing to buy land and build buildings. To do so, they have used hundreds of trillions of easily earned monopoly profits. As a result, China’s real estate prices have shot sky high. Due to the high housing prices, many “ghost towns,” where nobody lives, have emerged in China. Meanwhile, migrant workers cannot afford to bring their families from the countryside to the cities where they work. That is why China always faces extremely high traffic congestion during the annual “Spring Festival Travel Rush,” when migrant workers return home to see their families.  

The article concluded that the high price of housing has commandeered China’s entire national economy. Although huge amounts of wealth and resources have been invested in real estate, ordinary Chinese people still cannot afford an apartment.  

Source: Caijing Magazine website, February 3, 2013