A Crisis of Crisis Management? Evaluating Post-2010 Housing Restructuring in Nanjing, China

Abstract

In less than 20 years the housing system in China has been transformed from one based predominantly on the public provision of housing to a market-based system, to the extent that more than 80% of households in urban China are homeowners. The sheer scale of this change, compressed into such a short time, is impressive. However, the move to a commodified system has not been problem free. Indeed, the twin issues of displacement and, more generally, affordability are coming increasingly to the fore, resulting in significant policy shifts since 2010 toward the promotion of low-end housing for lower middle- and low-income groups. This article examines these issues through a detailed analysis of the implementation of the indemnificatory housing policy in Nanjing, and highlights the complex and often contradictory nature of this policy in practice.

Keywords:

• China
• urban housing
• indemnificatory housing
• gentrification
• displacement

Acknowledgments

Some research findings from this article were presented at the RC21 Conference in Urbino, Italy (August 27–29, 2015). We appreciate the support of Penny Koutrolikou, Stavros Stavrides, and Michael Janoschka, and the feedback from participants at the conference. Thanks to Desiree Fields, Stuart Hodkinson, and the three anonymous reviewers for their constructive comments on an earlier draft of this article.

Notes

1. According to the research of Peter Marcuse (1985), undertaken between 1970 and the mid-1980s in New York City, various types of displacement can occur. These include direct last-resident displacement, direct chain displacement, exclusionary displacement, and displacement pressure.

2. The exchange rate between the U.S. dollar and the Chinese Yuan was about 1 to 6.7 in August 2016.

3. Given that the typologies of ownership-oriented affordable housing are variegated across Chinese cities, Table 2 only lists the typologies of ownership-oriented affordable housing in Nanjing together with their corresponding Chinese pinyins.

4. In particular, a large volume of affordable housing has been occupied by medium and even high-income households because of the weak supervision of policy implementation.

5. Although typologies for ownership-oriented affordable housing and public housing in Nanjing experienced some changes since July 2015 (see Table 2), these changes do not affect the analysis and findings of this research.

6. However, neither of these policies is applied to affordable housing designated as rehousing units for rural displacees from the collectively owned rural land.

7. The initial goal of affordable housing was to provide for medium- and low-income households. The favoring of displacees, regardless of their economic situation, in the allocation of housing, has diverted the policy away from its original orientation.

8. The Housing Provident Fund is a compulsory, long-term and mutual saving help scheme assisting people formally employed by different sectors in Chinese cities to purchase, rent, and refurbish their and their direct relatives’ homes. The Housing Provident Fund can also be used for employees’ severe illnesses.

9. Measures for Management of Low-rent Housing Fund were introduced in 2007 (and took effect in 2008) by the State Council, requiring that 10% of annual land lease net income of local governments should be allocated to low-rent housing construction. However, this is still insufficient to meet demand.

10. Hukou is a household registration record for both urban and rural residents in China with Chinese nationality.

11. From the perspective of financial sustainability, the resale of public rental housing is expected to help Chongqing municipal government to repay the debt for constructing the large stock of public housing. The possibility for tenants to purchase the rental housing after 5-year tenancy is also mentioned in its local bylaw – The Temporary Management Measures of Public Rental Housing in Chongqing – although the detailed rules and regulations for resale have not been finalized and enacted. Meanwhile, the eligibility for tenants is reevaluated regularly. It is hard for tenants to lease these apartments long term.