From Chinese Press

Realty figures a real problem

(China Daily)
Updated: 2011-03-29 07:55

Gu Yunchang, vice-president of China Real Estate Association, said at an economic forum in Tsinghua University on March 20 that 89 percent of the people in the country owned a house and only the 11 percent who didn't, most of them belong to the 1980s' generation, were complaining about skyrocketing housing prices. His remarks can only be seen as a deliberate mistake, says an article on eastday.com. Excerpts:

Gu Yunchang seems to say that since members of the 1980s' generations cannot buy a house, they have "kidnapped" public opinion to influence government policies, especially because they are a major force on the Internet.

Perhaps he reached his conclusion from official figures that say 89.3 percent of the rooms occupied in towns and cities in China are from the private sector. But Gu should know that occupying a room is not the same as owning a house.

The room occupancy rate helps determine the health of the real estate market. It is calculated according to the percentage of private apartments in the entire housing market. That 89 percent of real estate is private does not mean 89 percent of people own a house.

The truth is that the private sector, with 89 percent of its "rooms occupied", has a much greater say in China's real estate market than in many developed countries.

For instance, the private sector holds only 68 percent and 70 percent of the real estate market in the United States and the United Kingdom. So the high market share that private players hold in China's real estate sector cannot be seen as development of market economy in the real sense of the term.

But people who represent the private sector, such as Gu, use these number to mislead the public. This is a dangerous move and should be nipped in the bud.