Reform of the Chinese housing system in the 1990s

Abstract

This thesis considers the Chinese housing reforms of the 1990s in the context of the previous system and assesses their impact. The PRC housing system evolved gradually from 1949 onwards. Described as a "work unit welfare-in-kind housing provision system", it was widely perceived as having fundamental flaws and was targeted for reform from 1978 onwards. Following a period of protracted experimentation from 1978 to 1990, the Chinese government launched a new wave of comprehensive housing reforms from the beginning of the 1990s. The four key early measures were: rent increases, the sale of public housing, the creation of the Housing Accumulation Fund, and the development of Economic and Practical Housing. However, these changes had only limited impact, and a new policy, monetised housing provision, was introduced in the late 1990s, along with a series of ancillary policies. This aimed to prohibit the allocation of housing to employees by work units, directing them instead to provide a cash allowance as part of wages; employees were directed to purchase or rent accommodation in the market. This was intended to speed up the process towards a market economy in the housing sector. The fact that housing reforms have such a major impact on all urban families makes them extremely sensitive. At the same time, reforms in other areas of the economy are dependent on the successful implementation of housing reforms. This thesis analyses the impact of the reforms and assesses how far they have succeeded in making fundamental changes to the housing provision system.