ABSTRACT
According to a survey provided by SINA, 2 one of the top four Chinese web portals, the top concern of Chinese citizens may be the cost of housing (see Figure 3.1). From 2004 to 2010, in metropolitan areas such as Beijing, the average price of housing increased from 4,747 Yuan/m2 to 17,151 Yuan/m2, growing by 23.9 per cent annually, twice as rapidly as nominal income. 3 A similar trend could also be observed in the US, where housing prices also increased at twice the CPI index between 1973 and 1980 in Los Angeles. 4 However, housing affordability has become an even more severe problem in China, with the housing-price-to-income ratio rising to 7.4 in 2011, twice as high as in the US. The ratio in metropolitan areas alone, such as Beijing and Shanghai, is higher than ten. 5 This is compared to the acceptable level proposed by the World Bank of 46 (World Bank 1992). Housing has become increasingly less affordable in China over the past decade, with housing prices considerably higher than the income of the ordinary citizens. What is a Chinese citizen's top concern?. https://s3-euw1-ap-pe-df-pch-content-public-p.s3.eu-west-1.amazonaws.com/9780203491638/cd7e7173-b480-4531-bec2-27b7852e14f4/content/fig3_1_B.jpg" xmlns:xlink="https://www.w3.org/1999/xlink"/> (source: SINA – see note 2 to this chapter)
