Skip to navigation – Site map

HomeIssues2013/2Special FeatureChanges in the Chinese Property M...

Special Feature

Changes in the Chinese Property Market: An indicator of the difficulties faced by local authorities

Mylène Gaulard
Translated by Will Thornely
p. 3-14

Abstract

For the past decade, China has faced an extremely sharp rise in property prices and increasingly large investments made in this sector. Although some economists consider this change to be no more than the result of the increase in urban salaries that has gone hand-in-hand with China’s strong economic growth, this article will show that it is in fact a “property bubble” resulting from the speculative activities of certain economic agents operating in this sector. Local authorities play a major role in this, especially in their efforts to increase their income, and their behaviour needs to be analysed in order to better understand that a bursting of this bubble might expose economic problems of a far deeper structural nature than those usually identified.

Top of page

Full text

1An observation often made since the last international economic crisis points to the decoupling of the economic development of China, which appears to be maintaining a high rate of growth, from that of the wealthiest countries of Western Europe and North America. However, the Chinese economy experienced a slowdown in 2012, and while Gross Domestic Product (GDP) grew by 9.3% in 2011, it only reached 7.8% in 2012. This slower rate of growth is more often than not put down to the economic crisis that China’s main commercial partners are experiencing. The economic slowdown in these countries has weighed considerably on Chinese exports, which now represent “only” 31% of GDP as opposed to 38% in 2007. Along with a reduction in imports, this has led to a drop in the trade surplus from 9% to 2% of GDP over this period. Since the domestic market is unable to take over from external demand, China appears to have no choice but to depend heavily on the economic circumstances of so called developed countries to maintain its rate of growth.

2However, this article will show that commercial dependence, which is so often emphasised, is actually just one of the problems China faces. Attention will instead be paid to the Chinese property bubble, which has been growing since the early 2000s and is likely to burst in the very near future and expose problems that are far more structural in nature than a mere slowdown in the export market. Firstly, we will analyse the increase in Chinese property prices, the opening up of this market in the 1990s, and the reasons why we consider the current increase in prices to be a “bubble.” We will then focus on the role played by local authorities in this change, in particular in order to reveal the major difficulties the Chinese economy will have to face up to in coming years.

Straightforward changes in the property sector or a property “bubble”?

3Although some economists argue that the recent rapid growth in the Chinese property market can be explained by strong economic growth going hand-in-hand with a process of liberalisation of this market, the change observed carries all the hallmarks of a speculative “bubble.”

A justified rise in property prices

Description of the Chinese property boom

  • 1 Jing Wu, Joseph Gyourko, Yongheng Deng, “Evaluating Conditions in Major Chinese Housing Markets,” N (...)
  • 2 Ashvin Ahuja, Lillian Cheung, “Are house prices rising too fast in China?”, IMF Working Paper, Dece (...)
  • 3 Jing Wu, Joseph Gyourko, Yongheng Deng, “Evaluating Conditions in Major Chinese Housing Markets,” a (...)
  • 4 Steven Barnett, Ray Brooks, “What’s driving investment in China,” IMFWorking Paper, November 2006.

4Property prices doubled between 2004 and 2011 in China’s 35 biggest cities (see Graph 1), and many economists have sought to analyse this change in an effort to understand, in particular, if it represents a bubble, or in other words, if a gap is opening between the basic value of goods and their market price. Before presenting this debate, it must be noted that although the increase was slower in 2011, prices have actually continued to rise in the biggest Chinese cities. This was one of the trends researched by the NDRC (National Development and Reform Commission), and by Tsinghua University, based on a sampling of 1,000 new and pre-owned properties in 70 cities.1 Ahuja and Cheung2 argue that in the 70 biggest cities in China, some of which are located in the inland provinces, the increase in prices reached a level of “only” 35% between 2004 and 2009, as opposed to 100% in the 35 biggest cities, which are mainly located on the coast. This price increase has been accompanied by a growth in investment in the residential and other property sectors, which currently accounts for a little more than 30% of gross fixed capital formation (GFCF), compared with 22% in 2005 (see Graph 2). Owing to this considerable investment ploughed into property, China consumes nearly 60% of the cement produced worldwide, and 43% of the construction equipment, such as bulldozers and diggers. The construction sector represents 5.7% of GDP, employs 14.3% of urban workers, and uses 40% of the steel produced in China.3 This change is even more marked in the coastal cities, and Guang-dong Province, the nerve centre of the Chinese economy, was attracting more than one third of the country’s property investments as far back as 2006.4

A change linked to the liberalisation of the property market

  • 5 Shinichi Seki, “Risk of a Housing Bubble Collapse in China Extremely Remote,” Pacific Business and (...)
  • 6 Youqin Huang, “Housing Markets Government Behaviors and Housing Choice: A Case Study of Three Citie (...)
  • 7 Charles Kindleberger, Manias, Panics and Crashes: A History of Financial Crises, New York, Basic Bo (...)
  • 8 Robert Shiller, Karl Case, “Is There a Bubble in the Housing Market,” Brookings Papers on Economic (...)

5This concentration of property investment and the increase in prices in the richest regions experiencing the strongest economic growth has led certain writers5 to reject the theory of a property bubble, i.e., an increase in prices that is disconnected from economic growth and in particular from the basic value of goods.6 Economists ranging from Kindleberger7 to Shiller8 have defined a bubble as an excessive rise in prices in relation to the basic value of the goods exchanged and incomes. This rise tends to be aggravated by the speculative behaviour that it encourages or, in other words, decisions to buy purely with the aim of selling the purchased goods at a higher price. Yet the aforementioned writers do not see the Chinese situation as a property bubble, because the increase in prices has simply kept pace with economic growth and the increase in incomes nationally, and has taken place against a backdrop of liberalisation in the property market.

  • 9 James Barth, Michael Lea, Tong Li, “China’s Housing Market: Is a Bubble About to Burst,” Milken Ins (...)

6The opening up of the property market in the 1990s resulted in a sharp rate of growth in this sector, and at this point a short history of property in the People’s Republic of China needs to be set out in order to understand this change. With the establishing of the PRC in 1949, urban property was nationalised, and for more than three decades, the state had sole power to distribute this property to households, in particular through the work units (gongzuo danwei 工作单位), which enabled households to obtain accommodation at very low rents. It was only in the 1980s that privatisation began to take place, initially in several coastal cities before being rolled out nationwide.9 At first, this involved starting to privatise certain state-owned housing, which was sold to foreigners or private sector employees.

  • 10 Jing Wu, Joseph Gyourko, Yongheng Deng, “Evaluating Conditions in Major Chinese Housing Markets,” a (...)

7In 1988, the constitution was changed in order to encourage the development of the private property sector, and although the state retained its status as sole landowner, the constitution now authorised it, along with local authorities, to sell land use rights lasting for a maximum of 70 years. Later, in 1994, a series of measures was brought into effect in order to encourage Chinese households to purchase, at below market prices, the housing that had until then been provided to them by their work units. In 1998, at the same time as a surge in the privatisation of the least profitable state companies, the remaining work units were prohibited outright from procuring accommodation in any form whatsoever for their employees, and from then on this old benefit was instead to be directly incorporated into the salary paid. This liberalisation of the market explains why the surface area supplied by the private property sector increased from 25 million square metres in the mid-1980s to nearly 500 million in 2007.10

  • 11 James Barth, Michael Lea, Tong Li, “China’s Housing Market: Is a Bubble About to Burst,” art. cit., (...)

8The Ministry of Housing and Urban-Rural Development and the National Bureau of Statistics estimate that, owing to this mass privatisation, 80% of housing is now held by the private sector.11 Some economists confuse this rate with the rate of household property ownership as it is calculated in the majority of other countries, where it indicates the percentage of households that own their homes. While the Centre for Financial Research of the People’s Bank of China estimated the rate of property ownership to be 89.68% in 2010, it should not be forgotten that the survey carried out that year reflected only 4,000 households (out of 400 million across China), and that this rate did not take into account illegal workers whose only option when it came to finding urban accommodation was to rent because they had left the countryside without first obtaining an urban residency permit; it is estimated that such workers represent as much as 30% of the working population in cities.

  • 12 Bai Guo, Pierre Mongrué, “Bulletin Économique Chine,” French Embassy in China, Beijing, October 200 (...)
  • 13 Shen Bingxi, Yan Lijuan, “Development of consumer credit in China,” China Quarterly Monetary Policy (...)

9Despite these few reservations, there is no doubting the fact that the opening up of the property market has seen more and more households taking ownership of their homes. This trend pushes prices up, a phenomenon accentuated by the fact that three quarters of urban families, whether property owners or not, would now like to obtain a new home because of the low level of legal protection afforded to tenants and their wish to improve their living conditions,12 as illustrated by the fact that the average living space had grown to 27 square metres by the end of 2009, compared with just 6.7 in 1978.13

  • 14 Shinichi Seki, “Risk of a Housing Bubble Collapse in China Extremely Remote,” art. cit., p. 10.

10Increasing urbanisation (see Graph 3) is another reason behind an increasingly high level of demand for housing in cities, and the fact that it is easier to obtain a residency permit (hukou) in China’s ten biggest cities (in particular Shenzhen and Shanghai) suggests that this movement could increase:14 compared with just 20% of the total population in 1980, urbanisation reached a level of 50% in 2011. The big increase in the average urban salary, which grew by 260% between 2001 and 2010, as illustrated in graph 4, goes even further towards explaining the pressure on property prices.

All the hallmarks of a bubble

An increase in the ratio between property prices and average household incomes

  • 15 Robert Shiller, Karl Case, “Is There a Bubble in the Housing Market,” art. cit.

11Although the basic value of a property is one of the most difficult concepts to calculate, there are certain indicators of a gap between the market price and the economic development of an area. In particular, in the view of Robert Shiller, who analysed price increases in the United States property sector in the years leading up to the bursting of the bubble (1988‑2003), a bubble can be identified by the enthusiasm shown by the entire population, especially the media, for a sector that allows immense fortunes to be created, at the same time that a gap is growing between the rate at which incomes are growing and the increase in property prices.15

Graph 1 – Property prices in major Chinese cities, in yuan per square metre

Graph 1 – Property prices in major Chinese cities, in yuan per square metre

Source: BBVA Research, China Real Estate Outlook, 2010‑2012

Graph 2 – Property investment in China, in billions of yuan

Graph 2 – Property investment in China, in billions of yuan

Source: National Bureau of Statistics, China Statistical Yearbook, 2011

  • 16 Hee Soo Chung, Jeong Ho Kim, “Housing speculation and housing price bubbles in Korea,” KDI School o (...)

12There is no ignoring the fact that a high proportion of Chinese billionaires now come directly from this sector: according to the Asia Pacific Wealth Report of 2010, 18% of Chinese billionaires in 2008 were property developers, compared with 27% in 2010. Above all, the ratio between average property prices and the average annual incomes of households, which were studied at length by Chung and Kim16 with regard to the property bubble that developed in South Korea in the decade starting in 2000, is becoming ever higher. Chung and Kim considered that while a “reasonable” level for this ratio could be set at between 3 and 4 to 1, it was greater than 10 to 1 in the South Korean cities that formed the study. Similarly, this ratio has reached an average of 8.5 to 1 in Chinese cities, and is in excess of 15 to one in the large coastal cities (see Graph 5). Such figures clearly indicate the presence of a bubble, and are all the more marked when compared with the ratio of 8 to 1 observed in Spain or the United States at the height of their property bubbles.

  • 17 International Labour Organization, Global Wage Report 2010/2011, Geneva, ILO, December 2010.
  • 18 Mylène Gaulard, “Salaires et croissance en Chine et au Brésil” (Salaries and growth in China and Br (...)
  • 19 Jing Wu, Joseph Gyourko, Yongheng Deng, “Evaluating Conditions in Major Chinese Housing Markets,” a (...)

13The spectacular rise in urban incomes described above needs to be examined more closely. The salary data only relates to salaries paid by urban establishments in the formal sector, yet the informal sector currently accounts for more than 50% of the working population of China;17 moreover, it does not take into consideration migrant workers who have left the countryside in order to work in the cities without an urban residency permit, and who may be paid 40% less than so-called resident workers.18 This analysis of urban incomes in large Chinese cities therefore explains why the increase in the ratio between property prices and average household incomes has been so great since the mid-aughts, using data obtained through field studies, which is more accurate than macroeconomic data gathered on a national scale.19

14This development looks as though it could be dangerous for the Chinese economy, because the ratio weighs heavily on household consumption, which at just 37% of GDP is one of the lowest levels in the world. On top of the precautionary savings set aside by households in order to cover healthcare, education, and retirement spending (areas for which the state is offering less and less cover), additional savings are being built up because of the wish of Chinese households to one day own their own home. It is even estimated that young urban couples are more often than not obliged to use up the savings of all four parents in order to become homeowners.

The increasing burden of bank credit

  • 20 Violaine Cousin, Banking in China, New York, Palgrave MacMillan, 2011, p. 154.

15The increasing burden of bank credit on the Chinese economy is another clear sign of a bubble. According to the People’s Bank of China, the volume of bank loans rose to 145% of GDP in 2011, whereas the rate had been lower than 100% until the middle of the 1990s (see Graph 6). This brings China close to the situation in many Asian countries prior to the 1997 financial crises and in Japan during the 1980s, and is aggravated by the fact that bad debt is thought to represent 10% of GDP.20 Between 2004 and 2010 alone, bank loans increased by 146% (see Graph 7), and the value of mortgage loans, which formed a proportion of these loans, increased nineteen-fold between 1999 and 2010.

16In the late 1990s, against the backdrop of liberalisation of the market described above, the government began to strongly encourage the granting of mortgage loans in order to stimulate domestic demand and avoid the slowdown that was affecting the whole of South-East Asia at that time. In 1998, loans worth up to 80% of the purchase price value of a property were introduced, with a maximum term set at 30 years. As shown in Graph 8, the reduction in interest rates since the middle of the 1990s has made bank loans from the major national banks even more attractive, despite the slight increase in rates between 2009 and 2011 aimed at curbing overheating. It is above all through managing the level of required reserves, which rose from 6% in 2003 to 21.5% in 2011, that the government is seeking to control inflation. This specific monetary policy makes it possible to continue offering low interest rates to economic agents who successfully take out loans.

  • 21 Shen Bingxi, Yan Lijuan, “Development of consumer credit in China,” art. cit., p. 55.

17Apart from the commercial banks, the main source of official household finance is the Housing Provident Fund or HPF (zhufang gongjijin 住房公积金), which employers and employees have been paying into since 1992 and which makes it possible to offer low interest rates to the latter. At the end of 2007, this fund represented 17.5% of all mortgage loans,21 compared with 79.4% provided by the commercial banks.

18Although the proportion of mortgage loans granted to households is constantly on the increase, it should be noted that it is not they who benefit most from the extension of bank credit; three quarters of the loans paid out by the official banking sector are paid to public bodies. As we will see in the second part of this article, the behaviour of these public bodies, local governments and public companies, goes a long way to explaining the current increase in prices and bank loans. Indeed, it is impossible to grasp the changes in the Chinese property market without taking into account the status of land in this country, the economic interests at stake for local governments, and the deep-rooted challenges that are increasingly weakening their position and making them dependent on increasing property prices.

The role of local governments in the Chinese property market

19Local governments are directly involved in the inflation of the property bubble, and the role they play in this market can be explained, above all, by the financial difficulties they have faced in recent years. These difficulties, and the fact that income from the property sector is essential to them, largely explain the central government’s inability to control the development of this sector.

Local authorities playing a part in the inflation of the property bubble

A role related to the specific status of the land market

  • 22 Patrick Artus, Jacques Mistral, Valérie Plagnol, L’émergence de la Chine: impact économique et impl (...)
  • 23 Zlotowski in Patrick Artus et al., L’émergence de la Chine: impact économique et implications de po (...)
  • 24 Ibid., p. 285.

20Local governments (provinces, townships, and villages) get around the fact that banks are prohibited from lending to them by creating ad hoc companies called Local Government Financing Vehicles (LGFV) (difang zhengfu rongzi pingtai 地方政府融资平台). Using these financing bodies, the authorities have been able to absorb nearly 50% of the bank loans paid out over the past ten years,22 and it is thought that each local authority is currently linked to approximately ten LGFVs, as opposed to four in 2008. Three quarters of these bodies are dependent on lesser authorities, below township level, which makes it very difficult to control them.23 According to an audit carried out by the National Audit Office (NAO, shenjishu ) in 18 provinces, 16 cities, and 36 townships,24 the territorial entities studied have a debt ratio exceeding 400% of their income. This level of debt is made possible largely by the proliferation of these financing bodies. According to the China Banking Regulatory Commission, only 27% of the loans paid out to LGFVs are covered by the revenue earned from the investments made.

Graph 3 – Rate of urbanisation as a percentage of the total population

Graph 3 – Rate of urbanisation as a percentage of the total population

Source: National Bureau of Statistics, China Statistical Yearbook, 2011

Graph 4 – Actual average annual urban salary in China (in yuan)

Graph 4 – Actual average annual urban salary in China (in yuan)

Source: National Bureau of Statistics, China Statistical Yearbook, 2011 (actual salary calculated from the average nominal salary deflated by the consumer price index)

  • 25 Scott Rozelle, Johan Swinnen, From Marx and Mao to the Market: The economics and politics of agricu (...)

21Yet this increasing debt is leading local authorities to play a role in the inflation of the Chinese property bubble. Indeed, in order to capitalise their financing bodies, the authorities transfer to them land or buildings that serve as a guarantee to the banks. At this point, grasping the specific status of land ownership is essential in order to gain a better understanding of the rapid growth that has taken place in the property sector since the 2000s: legally, the land continues to belong to the state (or, more specifically, to the central government in urban areas, and to local authorities, mainly village committees, in rural areas), and the proportion that the local governments are authorised to sell by granting land use rights (rather than “ownership rights”) remains indeterminate, with negotiations more often than not taking place at a local level. This means that local governments have the power to requisition land, and explains why the land of more than 50 million peasants was expropriated in the decade starting in 2000.25 As we will see below, after recovering land that was initially requisitioned by the state, the local authorities sold the usage rights of this land to property developers, or used it directly in order to make significant investments themselves in construction projects that were often of a non-residential nature.

Graph 5 – Change in the ratio between property prices and annual incomes in Beijing and Shenzhen

Graph 5 – Change in the ratio between property prices and annual incomes in Beijing and Shenzhen

Source: Wu, Gyourko, and Deng (2010)

Graph 6 – Domestic bank loans, as a percentage of GDP

Graph 6 – Domestic bank loans, as a percentage of GDP

Source: World Bank, World Development Indicators, 2011

  • 26 Michel Aglietta, Guo Bai, La Voie chinoise, Paris, Odile Jacob, 2012, p. 357.
  • 27 Jing Wu, Joseph Gyourko, Yongheng Deng, “Evaluating Conditions in Major Chinese Housing Markets,” a (...)
  • 28 Cheng Li in Hu Angang, China in 2020: A New Type of Superpower, Washington, Brookings Institution, (...)
  • 29 Ibid.

22Since 1988, the Chinese Constitution has stated that authorities are permitted to sell land use rights that were typically acquired at a very low price by public companies (Graph 9) or bodies close to the local authorities who wished to profit from the low price of land26 and very quickly release income from their property investments. It was estimated in 2010 that 71% of the land use rights in Beijing had been bought by public companies, compared with 37% in 2003.27 Of the 129 State companies controlled by the central government and monitored by the State-owned Assets Supervision and Administration Commission of the State Council (SASAC), 70% had made investments in property,28 and it can be assumed that this percentage is higher still in the case of public companies that are dependent on the local authorities. For this reason, one third of the 2008 recovery plan was channelled towards the property sector.29

Graph 7 – Mortgage loans, in billions of yuan and as a percentage of bank loans

Graph 7 – Mortgage loans, in billions of yuan and as a percentage of bank loans

Source: People’s Bank of China, Sources and Uses of Funds of Financial Institutions, 2010

Graph 8 – Interest rate (one-year loans), in %

Graph 8 – Interest rate (one-year loans), in %

Source: People’s Bank of China, China Monetary Policy Report, 2012

  • 30 Kun Liu, Procédures et acteurs de l’utilisation du foncier chinois dans un contexte de mutations so (...)
  • 31 Jing Wu, Joseph Gyourko, Yongheng Deng, “Evaluating Conditions in Major Chinese Housing Markets,” a (...)
  • 32 Kun Liu, Procédures et acteurs de l’utilisation du foncier chinois dans un contexte de mutations so (...)

23This system not only enables public companies to invest in the property sector, but also further benefits them through the subsequent sale of usage rights at higher prices.30 A law introduced in 2004 as part of the fight against corruption has made it mandatory for transactions involving the transfer of land use rights to take place on the market, rather than through direct negotiations with local authorities. Although this is not an easy rule to apply, it does explain why the proportion of property value accounted for by land has not stopped rising since the middle of the decade,31 representing 23% of the price of homes,32 and even as much as 60% in Beijing,

24because successive instances of speculation on the use rights of a piece of land will push its price up considerably.

Graph 9 – Proportion of the various property developers purchasing land use rights in Beijing, as a percentage of the total surface area purchased (2008)

Graph 9 – Proportion of the various property developers purchasing land use rights in Beijing, as a percentage of the total surface area purchased (2008)

Source: Wu, Gyourko and Deng (2010)

Investments intended for the wealthy

  • 33 James Barth, Michael Lea, Tong Li, “China’s Housing Market: Is A Bubble About to Burst,” art. cit., (...)
  • 34 Ibid., p. 16.

25In 1998, a law was introduced defining the concept of “price-subsidised housing” (jingji shiyong fang 经济适用房), for which the sale price is subsidised, as opposed to the existing “subsidised rental housing” (lianzu fang 廉租房), for which rent is subsidised. The aim of this new concept was to provide housing for families earning modest incomes at a price of only 3 to 5% more than the construction cost, with an injection of funding coming mainly from the Housing Provident Fund. Today, figures show that only 3% of new housing falls under the price-subsidised housing category, compared with a high of 25% at the end of the 1990s,33 because the authorities involved in the property market can see little real point in investing in this unprofitable sector. With a view to increasing the sale price of use rights, local governments have even gone to the length of imposing limits on the amount of land that can be used for residential purposes.34 This helps explain the inflexible nature of land prices available on the market and pushes housing prices up even further. As Graph 2 (see above) shows, investment in non-residential construction is increasing at a much faster rate than in residential construction.

  • 35 Kun Liu, Procédures et acteurs de l’utilisation du foncier chinois dans un contexte de mutations so (...)
  • 36 Lu Gao, “Achievements and challenges: 30 years of housing reforms in the People’s Republic of China (...)
  • 37 He Shenjing, Wu Fulong, “China’s Emerging Neoliberal Urbanism: Perspectives from Urban Redevelopmen (...)

26Local authorities also show a reluctance to attract residents earning low incomes, instead favouring investment in the luxury residential sector, which is likely to attract households earning high incomes that will provide them with considerably greater income from taxation.35 This behaviour is at the root of an even higher ratio between property prices and the incomes of the poorest households: Gao Lu36 claims that while this ratio averages out at 20 to 1 in the ten largest cities of China, it is only 2.45 to 1 for the richest 20% of households, as opposed to 22.69 to 1 for the poorest 20% (compared with an average of 5.6 to 1 and 9.7 to 1, respectively, in the rest of the world). This development is behind the emergence in China of “neoliberal urbanism,”37 whereby there is an increase in infrastructure and property intended for the wealthiest categories to the detriment of the majority of the population.

  • 38 The city was designed for more than one million inhabitants, but five years after being built has a (...)
  • 39 James Barth, Michael Lea, Tong Li, “China’s Housing Market: Is a Bubble About to Burst,” art. cit., (...)
  • 40 Kun Liu, Procédures et acteurs de l’utilisation du foncier chinois dans un contexte de mutations so (...)

27The investments made in the construction and luxury residential sectors – rather than in developing areas of the property sector that serve the households most in need – are a strong indicator of mass speculation, and could yet prove to be instances of considerable overinvestment. Such phenomena have attracted increasing media attention in recent years, with reports on the proliferation of ghost cities – Ordos38 in Inner Mongolia being one fairly typical example – as well as under-used airports and roads and an increase in the number of empty homes, which current estimates number at more than 70 million.39 In his 2008 doctoral thesis, Kun Liu observed that “by failing to take all the various types of homes into consideration, the supply of land for the property market does not effectively meet the full range of demand, and instead has a tendency to aggravate the imbalance between the provision of luxury housing and the general demand for ordinary housing.”40

28We will now look at how the behaviour of local authorities to push property prices up can be explained by the profound financial problems they currently face and that they will have to tackle due to major structural faults in the Chinese economy and the financially unbalanced relationship between the central government and local authorities.

Property: An indispensable source of income for local governments

Increasing financial difficulties

  • 41 Ichiro Muto, Miyuki Matsunaga, “On the recent rise in China’s real estate prices,” Bank of Japan Re (...)
  • 42 Ashvin Ahuja, Lillian Cheung, “Are house prices rising too fast in China?”, art. cit., p. 4.
  • 43 Ichiro Muto, Miyuki Matsunaga, “On the recent rise in China’s real estate prices,” art. cit., p. 6.

29The role played by the local authorities in inflating property prices enables them to draw considerable income from this sector. In 2009, from a total income of 3,258 billion yuan made by all the local governments, an estimated 481 billion (or 15%) was generated by the property sector.41 It should also be remembered that this sum does not factor in significant income such as that earned from the sale of use rights of land expropriated from peasants, who receive derisory sums in compensation. In Beijing and Zhejiang Province, for example, the sale of land use rights alone represents 30% of local government income.42 At a national level, if the income generated from land transfers is added to that made from investments in property, the total income from property rises to 1,366 billion yuan, or nearly 50% of the overall income of the governments in 200943 (Graph 10).

Graph 10 – Local government income in billions of yuan

Graph 10 – Local government income in billions of yuan

Source: National Bureau of Statistics (China Statistical Yearbook, 2011); Ministry of Land and Resources (National Land and Resources Statistical Yearbook, 2011)

Graph 11 – Budget balance of the central and local governments as a percentage of GDP

Graph 11 – Budget balance of the central and local governments as a percentage of GDP

Source: National Bureau of Statistics, China Statistical Yearbook, 2012

  • 44 Christine Wong, “Central-local Relations Revised,” China Perspectives, September-October 2000, No. (...)

30This income is currently essential for local authorities because of the serious financial difficulties they face. Following the decentralisation policy of the 1980s, local governments were handed responsibility for 75% of public spending carried out on Chinese territory, but taxation no longer generates enough income for them to balance their budgets. The recentralisation that took place in 1994 did not lead to an improvement in their budget balance; on the contrary, although it left the majority of spending in the hands of local governments, the majority of their income was channelled back into the central government budget. Indeed, since 1994, the central government has received 50 to 55% of the annual income from taxation, compared with 33% during the previous decade, despite the fact that since the end of the 1990s, 80% of public spending has been the responsibility of the local authorities.44 The latter must assume financial responsibility for public services in addition to implementing the social policies of the state, which means that more than 90% of spending on education, healthcare, and environmental protection is currently covered by local authorities.

  • 45 Sandra Poncet, “The fragmentation of the Chinese domestic market,” China Perspectives, No. 55, Sept (...)

31This change in the way government spending and income are apportioned is at the root of the deepening deficit of local authorities, which increased from 3% of GDP in 1994 to 8.5% in 2011 (Graph 11). In a similar development, while central government debt is only 17% of GDP, that of the local governments had already officially reached 27% in 2010 compared with 18% at the end of 2008 (Graph 12). Faced with the recentralisation policy introduced in 1994, it was very much in the interests of the local authorities to stimulate the property market, make significant profits through the sale of land use rights, and attract the wealthiest households by constructing luxury housing in order to increase taxation revenues from this group. The fact that the majority of decisions pertaining to public investment are decentralised45 also explains the instances of overinvestment referred to above, such as the construction of several airports only a few dozen miles apart.

Graph 12 – Debts of the various Chinese public bodies in 2010, as a percentage of GDP

Graph 12 – Debts of the various Chinese public bodies in 2010, as a percentage of GDP

Source: Ministry of Finance (2011), China Banking Regulatory Commission (2011), Ministry of Railways (2011)

  • 46 Yu Yongding, “China’s Policy Responses to Global Financial Crisis,” Richard Sanape Lecture, Melbour (...)
  • 47 Jing Wu, Joseph Gyourko, Yongheng Deng, “Evaluating Conditions in Major Chinese Housing Markets,” a (...)

32This kind of behaviour is encouraged all the more by the fact that foreign investment is also playing a part in the increase in property prices. Indeed, this sector currently attracts more than a quarter of the direct foreign investment coming into the country (Graph 13). The profits generated by reselling property and land use rights at prices higher than the purchase price is now encouraging the vast majority of economic agents to look to this sector rather than to an increasingly unprofitable means of production.46 In the same way, public companies, the vast majority of which are now dependent on local authorities,47 also find themselves faced with profitability problems linked to the difficulties the latter are experiencing when it comes to balancing their budgets. The result is that all these actors are encouraged to seek to profit from the property sector in order to increase their incomes.

The essential implementation of policies to fight speculation

  • 48 Liu Changming, Zou Rongchang, “Study on the Development of Chinese Real Estate in the Context of Ur (...)

33The case of the city of Wenzhou48 possibly foreshadows what could very soon happen in the rest of the Chinese economy. While this south-eastern city was held up in the 1980s as a model of growth due to its high number of small and medium-sized enterprises in the export sector, the sudden 50% drop in property prices between 2011 and 2012 revealed the profound weaknesses of this model. In order to invest in the property sector, many companies in the city had taken out informal loans from non-banking institutions that offered loans under less stringent conditions but at far higher interest rates than the traditional banking sector; when the bubble burst, this excessive debt was exposed and caused the collapse of this shadow banking system. Yet as we have already seen, it is highly likely that the official banking sector is also making comparable loans that have allowed a similar bubble to develop at a national level, and also in the property market.

34Paradoxically, it is not so much the liberalisation per se of the property market that has caused this sector to rapidly grow and become disconnected from the rest of the economy. Rather, it is the overlap of this liberalisation with the financial difficulties faced by local authorities and public companies, which are making the most of a banking sector that is still very favourably disposed towards them. Therefore, contrary to the argument that is sometimes put forward as one of the reasons behind China’s economic success, it is by no means certain that the liberalisation of the market, which is taking place in a context in which the public sector is still a major player in the economy, is without its drawbacks for present-day China.

  • 49 Christine Peltier, “Éclairage sur les finances publiques chinoises” (Chinese public finances explai (...)
  • 50 James Barth, Michael Lea, Tong Li, “China’s Housing Market: Is a Bubble About to Burst,” art. cit., (...)

35In order to help finance local authority spending and forestall the lack of transparency of the financing bodies used until recently to take out bank loans, the central government launched a pilot programme in October 2011 involving the issuing of municipal bonds in cities such as Shanghai and Shenzhen, as well as in the provinces of Guangdong and Zhejiang. Furthermore, Shanghai and Chongqing are now authorised to levy a property tax,49 which should help increase the incomes of local authorities and also fight property speculation. That said, this tax poses a legal problem insofar as a property tax cannot be applied if the private right to own land is not recognised in the Constitution, which only authorises the “transfer of use rights.”50

36In order to counter the overheating observed in the property market, the Chinese government has also put in place various other measures, with mixed results. In terms of monetary policy, with the aim of limiting excessive bank debt, the interest rate on one-year loans rose consistently from 5.31% in 2009 to 6.56% by the end of 2011, and above all, the level of required reserves increased from 14% in 2009 to 21.5% in 2011, rising 12 times between 2010 and 2011 while the interest rate increased only three times during the same period.

  • 51 “2011 nian guowuyuan chutai loushi xinguo batiao” (New Eight Articles on the Property Market introd (...)
  • 52 Shinichi Seki, “Risk of a Housing Bubble Collapse in China Extremely Remote,” art. cit., p. 6.

37More specifically in terms of the property sector, new rules were also decreed in 2010, followed a year later by the “Eight New Articles”51 introduced specifically to restrict the number of bank loans paid out for purchasing or investing in property.52 For example, starting in 2010, loans were suspended beyond the purchase of a third property, and the minimum contribution required to purchase one’s home was increased from 20 to 30%; in 2011, the personal contribution required to purchase a second home was raised to 60% of the purchase price of the property, and the purchase of a second home by anyone registered as a resident for less than five years was prohibited. This final measure was initially piloted in Shenzhen and Shanghai before being rolled out to all other major cities. A new tax applicable to owners of two or more properties was also introduced in 2011.

Graph 13 – Direct foreign investments in China in billions of dollars

Graph 13 – Direct foreign investments in China in billions of dollars

Source: National Bureau of Statistics, China Statistical Yearbook, 2012; China’s State Administration of Foreign Exchange; Ministry of Commerce of the People’s Republic of China (2011)

Graph 14 – Changes in housing prices in the 70 biggest cities in China, given as the number of cities experiencing an increase, decrease or no change in the price per square metre

Graph 14 – Changes in housing prices in the 70 biggest cities in China, given as the number of cities experiencing an increase, decrease or no change in the price per square metre

Source: National Bureau of Statistics, “Sale Price Indices of Residential Buildings in 70 Large and Medium-Sized Cities,” 2013

  • 53 Kun Liu, Procédures et acteurs de l’utilisation du foncier chinois dans un contexte de mutations so (...)

38Moreover, in order to fight against speculation, leaving land unoccupied is prohibited, and the local authorities are required to take back land use rights if construction work has not started on a piece of land within two years.53 However, as the mere digging of a hole in the ground marks the start of construction work from a legal point of view, speculation remains very difficult to control in this way. Also, foreign investment in this sector is subject to very strict controls, and foreign entities entering the property sector are required to have offices in China or to be able to show they have partners working or studying in the country. This condition goes some way toward explaining why the hot money seeking to profit from property speculation often takes the form of FDI, and why direct investment is becoming more and more widespread in the property sector.

39Furthermore, the construction of social housing sold at a low price has received constant encouragement from the central government, and 36 million subsidised homes are set to be built by 2015. However, this is not necessarily in the interests of the local authorities, although much of the responsibility for building these homes rests with them.

  • 54 Dianchun Jiang, Jean Jinghan Chen, David Isaac, “The effect of foreign investment on the real estat (...)

40Although these measures are most probably behind the slight drop in prices seen in some cities during the final quarter of 2011 (Graph 14), their impact remains limited due to the behaviour of local authorities, which the central government finds even more difficult to control because it is in the interest of the state to let them take action to reduce the public deficit. However, it should not be forgotten that when China experienced the beginnings of a property boom a few years ago, this was swiftly brought to a halt when the central bank raised interest rates to limit overheating in this sector. Indeed, there was an increase in property prices in the early 1990s, during a period when the country was showing strong economic growth and implementing an expansive monetary policy. The free market economy was greatly stimulated in the property sector by the proliferation of property companies during the summer of 1992, and at the same time, state banks were given permission to begin operating in this sector. As a result, property prices rose by more than 30% between 1992 and 1993, before dropping in response to the restrictive monetary policy implemented by the government to curb inflation.54

41Such a scenario would currently be very dangerous for the Chinese economy, because it could expose the excessive debt of local authorities, along with major and risky implications for companies in the property sector, whether public or private, domestic or foreign. Indeed, this situation explains both the reduction in the level of required reserves on 5 December 2011 – the first such reduction granted to the banks by the Chinese government in three years – and the decrease in the reference interest rate in June 2012.

Conclusion

42The Chinese property market has been experiencing exceptionally rapid growth since the 1990s. The aim of this article was to demonstrate how this rapid growth could be considered a bubble, or in other words, if a gap is opening between the market price of goods and their basic value. Whether one decides to focus on the high price-to-income ratio, the level of bank debt weighing ever heavier on the Chinese economy, or the commissioning of construction projects that do not necessarily match national demand, there are a number of factors that perfectly illustrate this wide gap, which results from speculative activities that can be traced back to local authorities and public companies as well as private developers and many foreign firms. Nevertheless, this phenomenon cannot be understood without carrying out a more in-depth analysis of the particularities of the Chinese market.

43In order to better understand the Chinese property market, we have shown how 1988 and 1994 were decisive years in terms of inflating the current bubble. Authorising local authorities to transfer “land use rights” in 1988 marked the beginning of a period of land speculation based on the purchase of these use rights by public companies or private property developers enjoying privileged relations with the local authorities and thus able to obtain the use rights at modest prices with the aim of subsequent resale. In 1994, this phenomenon was further accentuated as urban households were encouraged to purchase the homes they had been provided with by their work units, and this liberalisation of the property market was the trigger for a sharp rise in housing prices that started in the 1990s. Another reason why this year was an important one in the history of the Chinese property market is that it saw the state recentralise the income earned from taxation, resulting in increasing financial difficulties for the local authorities, who still shoulder 75% of public spending nationally.

44The swift growth observed in the property sector today cannot be compared to that of the 1990s, because the current increase in prices is essential for reducing the public deficit of local authorities, given that half of their resources now come from the transfer of land use rights, and more generally from the property sector. Therefore, the changes in the Chinese property market reveal the serious financial problems facing local authorities and public companies, which appear to be less and less profitable. This analysis helps to better understand why, since the end of 2011, the Chinese government has been trying to boost economic activity by reducing interest rates, not only to counter an economic slowdown attributable to decreasing export volumes, but also to delay the bursting of the property bubble.

45Indeed, the drop in prices in 2011 gave rise to a real fear that the bursting of this property bubble was imminent. Should the bubble burst, the consequences on the Chinese economy would be disastrous, especially because the problems of excessive debt and increasing deficits of local authorities would be exposed, and because foreign capital invested in the property sector would be withdrawn. This would put serious pressure on China’s international reserves, which could at present be seen as its main asset.

46While the difficulties of the Chinese economy have more often than not been analysed in terms of the country’s strong dependency on its exports and the circumstances in which developed countries now find themselves, the above analysis of the property market indicates problems of a far more structural nature.

Top of page

Notes

1 Jing Wu, Joseph Gyourko, Yongheng Deng, “Evaluating Conditions in Major Chinese Housing Markets,” NBER Working Paper, No. 16189, July, 2010, pp. 531‑543.

2 Ashvin Ahuja, Lillian Cheung, “Are house prices rising too fast in China?”, IMF Working Paper, December 2010.

3 Jing Wu, Joseph Gyourko, Yongheng Deng, “Evaluating Conditions in Major Chinese Housing Markets,” art. cit., p. 26.

4 Steven Barnett, Ray Brooks, “What’s driving investment in China,” IMFWorking Paper, November 2006.

5 Shinichi Seki, “Risk of a Housing Bubble Collapse in China Extremely Remote,” Pacific Business and Industries, Vol. XII, No. 44, 2012, pp. 1‑16; Ashvin Ahuja, Lillian Cheung, “Are house prices rising too fast in China?”, art. cit.

6 Youqin Huang, “Housing Markets Government Behaviors and Housing Choice: A Case Study of Three Cities in China,” Environment and Planning, vol. 36, 2004, pp. 45‑68.

7 Charles Kindleberger, Manias, Panics and Crashes: A History of Financial Crises, New York, Basic Books, 1978.

8 Robert Shiller, Karl Case, “Is There a Bubble in the Housing Market,” Brookings Papers on Economic Activity, No. 2, 2003, pp. 299‑362.

9 James Barth, Michael Lea, Tong Li, “China’s Housing Market: Is a Bubble About to Burst,” Milken Institute, October 2012.

10 Jing Wu, Joseph Gyourko, Yongheng Deng, “Evaluating Conditions in Major Chinese Housing Markets,” art. cit., p. 6.

11 James Barth, Michael Lea, Tong Li, “China’s Housing Market: Is a Bubble About to Burst,” art. cit., p. 4.

12 Bai Guo, Pierre Mongrué, “Bulletin Économique Chine,” French Embassy in China, Beijing, October 2009.

13 Shen Bingxi, Yan Lijuan, “Development of consumer credit in China,” China Quarterly Monetary Policy Report, BIS Papers, No. 46, 2007, pp. 51‑57.

14 Shinichi Seki, “Risk of a Housing Bubble Collapse in China Extremely Remote,” art. cit., p. 10.

15 Robert Shiller, Karl Case, “Is There a Bubble in the Housing Market,” art. cit.

16 Hee Soo Chung, Jeong Ho Kim, “Housing speculation and housing price bubbles in Korea,” KDI School of Public Policy & Management Paper, No. 04‑06, 2004.

17 International Labour Organization, Global Wage Report 2010/2011, Geneva, ILO, December 2010.

18 Mylène Gaulard, “Salaires et croissance en Chine et au Brésil” (Salaries and growth in China and Brazil), Revue de l’IRES, No. 73, 2012, pp. 181‑204.

19 Jing Wu, Joseph Gyourko, Yongheng Deng, “Evaluating Conditions in Major Chinese Housing Markets,” art. cit.

20 Violaine Cousin, Banking in China, New York, Palgrave MacMillan, 2011, p. 154.

21 Shen Bingxi, Yan Lijuan, “Development of consumer credit in China,” art. cit., p. 55.

22 Patrick Artus, Jacques Mistral, Valérie Plagnol, L’émergence de la Chine: impact économique et implications de politique économique (The emergence of China: Economic impact and economic policy implications), Conseil d’Analyse Économique, Paris, 2011, p. 223.

23 Zlotowski in Patrick Artus et al., L’émergence de la Chine: impact économique et implications de politique économique, op. cit., p. 284.

24 Ibid., p. 285.

25 Scott Rozelle, Johan Swinnen, From Marx and Mao to the Market: The economics and politics of agricultural transition, Oxford, Oxford University Press, 2006, p. 221.

26 Michel Aglietta, Guo Bai, La Voie chinoise, Paris, Odile Jacob, 2012, p. 357.

27 Jing Wu, Joseph Gyourko, Yongheng Deng, “Evaluating Conditions in Major Chinese Housing Markets,” art. cit., p. 34.

28 Cheng Li in Hu Angang, China in 2020: A New Type of Superpower, Washington, Brookings Institution, 2011, p. 34 (introduction).

29 Ibid.

30 Kun Liu, Procédures et acteurs de l’utilisation du foncier chinois dans un contexte de mutations socio-économiques (Procedures and actors in the use of Chinese property in a context of socio-economic transformations), doctoral thesis at the Institut d’urbanisme de Paris, France, December 2008.

31 Jing Wu, Joseph Gyourko, Yongheng Deng, “Evaluating Conditions in Major Chinese Housing Markets,” art. cit., p. 35.

32 Kun Liu, Procédures et acteurs de l’utilisation du foncier chinois dans un contexte de mutations socio-économiques, op. cit., p. 79.

33 James Barth, Michael Lea, Tong Li, “China’s Housing Market: Is A Bubble About to Burst,” art. cit., p. 4.

34 Ibid., p. 16.

35 Kun Liu, Procédures et acteurs de l’utilisation du foncier chinois dans un contexte de mutations socio-économiques, op. cit., p. 254.

36 Lu Gao, “Achievements and challenges: 30 years of housing reforms in the People’s Republic of China,” Asian Development Bank Working Paper, No. 198, April 2010, p. 16.

37 He Shenjing, Wu Fulong, “China’s Emerging Neoliberal Urbanism: Perspectives from Urban Redevelopment,” Antipode, vol. 41, No. 2, pp. 282‑304.

38 The city was designed for more than one million inhabitants, but five years after being built has attracted only a few thousand, mainly because the price of housing is beyond the budget of the local population.

39 James Barth, Michael Lea, Tong Li, “China’s Housing Market: Is a Bubble About to Burst,” art. cit., p. 14.

40 Kun Liu, Procédures et acteurs de l’utilisation du foncier chinois dans un contexte de mutations socio-économiques, op. cit., p. 263.

41 Ichiro Muto, Miyuki Matsunaga, “On the recent rise in China’s real estate prices,” Bank of Japan Review, April 2010, p. 6.

42 Ashvin Ahuja, Lillian Cheung, “Are house prices rising too fast in China?”, art. cit., p. 4.

43 Ichiro Muto, Miyuki Matsunaga, “On the recent rise in China’s real estate prices,” art. cit., p. 6.

44 Christine Wong, “Central-local Relations Revised,” China Perspectives, September-October 2000, No. 31, pp. 52‑63.

45 Sandra Poncet, “The fragmentation of the Chinese domestic market,” China Perspectives, No. 55, September-October 2004, pp. 11‑20.

46 Yu Yongding, “China’s Policy Responses to Global Financial Crisis,” Richard Sanape Lecture, Melbourne, 25 November 2009; Mylène Gaulard, “Les limites de la croissance chinoise” (The limits of Chinese growth), Revue Tiers Monde, No. 200, December 2009, pp. 875‑893.

47 Jing Wu, Joseph Gyourko, Yongheng Deng, “Evaluating Conditions in Major Chinese Housing Markets,” art. cit., p. 13.

48 Liu Changming, Zou Rongchang, “Study on the Development of Chinese Real Estate in the Context of Urbanization,” Applied Mechanics and Materials, vol. 174‑177, 2012, pp. 2284‑2288.

49 Christine Peltier, “Éclairage sur les finances publiques chinoises” (Chinese public finances explained), Conjoncture, BNP Paribas, April 2012, pp. 23‑34.

50 James Barth, Michael Lea, Tong Li, “China’s Housing Market: Is a Bubble About to Burst,” art. cit., p. 23.

51 “2011 nian guowuyuan chutai loushi xinguo batiao” (New Eight Articles on the Property Market introduced by the State Council), Fazhi xinwenwang, 27 January 2011, www.news.9ask.cn/Article/sd/201101/1069752.shtml (accessed on 21 May 2013).

52 Shinichi Seki, “Risk of a Housing Bubble Collapse in China Extremely Remote,” art. cit., p. 6.

53 Kun Liu, Procédures et acteurs de l’utilisation du foncier chinois dans un contexte de mutations socio-économiques, op. cit., p. 320.

54 Dianchun Jiang, Jean Jinghan Chen, David Isaac, “The effect of foreign investment on the real estate industry in China,” Urban Studies, vol. 35, No. 11, 1998, pp. 2101‑2110.

Top of page

List of illustrations

Title Graph 1 – Property prices in major Chinese cities, in yuan per square metre
Credits Source: BBVA Research, China Real Estate Outlook, 2010‑2012
URL http://journals.openedition.org/chinaperspectives/docannexe/image/6143/img-1.png
File image/png, 50k
Title Graph 2 – Property investment in China, in billions of yuan
Credits Source: National Bureau of Statistics, China Statistical Yearbook, 2011
URL http://journals.openedition.org/chinaperspectives/docannexe/image/6143/img-2.png
File image/png, 41k
Title Graph 3 – Rate of urbanisation as a percentage of the total population
Credits Source: National Bureau of Statistics, China Statistical Yearbook, 2011
URL http://journals.openedition.org/chinaperspectives/docannexe/image/6143/img-3.png
File image/png, 21k
Title Graph 4 – Actual average annual urban salary in China (in yuan)
Credits Source: National Bureau of Statistics, China Statistical Yearbook, 2011 (actual salary calculated from the average nominal salary deflated by the consumer price index)
URL http://journals.openedition.org/chinaperspectives/docannexe/image/6143/img-4.png
File image/png, 49k
Title Graph 5 – Change in the ratio between property prices and annual incomes in Beijing and Shenzhen
Credits Source: Wu, Gyourko, and Deng (2010)
URL http://journals.openedition.org/chinaperspectives/docannexe/image/6143/img-5.png
File image/png, 17k
Title Graph 6 – Domestic bank loans, as a percentage of GDP
Credits Source: World Bank, World Development Indicators, 2011
URL http://journals.openedition.org/chinaperspectives/docannexe/image/6143/img-6.png
File image/png, 26k
Title Graph 7 – Mortgage loans, in billions of yuan and as a percentage of bank loans
Credits Source: People’s Bank of China, Sources and Uses of Funds of Financial Institutions, 2010
URL http://journals.openedition.org/chinaperspectives/docannexe/image/6143/img-7.png
File image/png, 36k
Title Graph 8 – Interest rate (one-year loans), in %
Credits Source: People’s Bank of China, China Monetary Policy Report, 2012
URL http://journals.openedition.org/chinaperspectives/docannexe/image/6143/img-8.png
File image/png, 29k
Title Graph 9 – Proportion of the various property developers purchasing land use rights in Beijing, as a percentage of the total surface area purchased (2008)
Credits Source: Wu, Gyourko and Deng (2010)
URL http://journals.openedition.org/chinaperspectives/docannexe/image/6143/img-9.png
File image/png, 29k
Title Graph 10 – Local government income in billions of yuan
Credits Source: National Bureau of Statistics (China Statistical Yearbook, 2011); Ministry of Land and Resources (National Land and Resources Statistical Yearbook, 2011)
URL http://journals.openedition.org/chinaperspectives/docannexe/image/6143/img-10.png
File image/png, 26k
Title Graph 11 – Budget balance of the central and local governments as a percentage of GDP
Credits Source: National Bureau of Statistics, China Statistical Yearbook, 2012
URL http://journals.openedition.org/chinaperspectives/docannexe/image/6143/img-11.png
File image/png, 22k
Title Graph 12 – Debts of the various Chinese public bodies in 2010, as a percentage of GDP
Credits Source: Ministry of Finance (2011), China Banking Regulatory Commission (2011), Ministry of Railways (2011)
URL http://journals.openedition.org/chinaperspectives/docannexe/image/6143/img-12.png
File image/png, 22k
Title Graph 13 – Direct foreign investments in China in billions of dollars
Credits Source: National Bureau of Statistics, China Statistical Yearbook, 2012; China’s State Administration of Foreign Exchange; Ministry of Commerce of the People’s Republic of China (2011)
URL http://journals.openedition.org/chinaperspectives/docannexe/image/6143/img-13.png
File image/png, 25k
Title Graph 14 – Changes in housing prices in the 70 biggest cities in China, given as the number of cities experiencing an increase, decrease or no change in the price per square metre
Credits Source: National Bureau of Statistics, “Sale Price Indices of Residential Buildings in 70 Large and Medium-Sized Cities,” 2013
URL http://journals.openedition.org/chinaperspectives/docannexe/image/6143/img-14.png
File image/png, 39k
Top of page

References

Bibliographical reference

Mylène Gaulard, Changes in the Chinese Property Market: An indicator of the difficulties faced by local authoritiesChina Perspectives, 2013/2 | 2013, 3-14.

Electronic reference

Mylène Gaulard, Changes in the Chinese Property Market: An indicator of the difficulties faced by local authoritiesChina Perspectives [Online], 2013/2 | 2013, Online since 01 June 2013, connection on 28 March 2024. URL: http://journals.openedition.org/chinaperspectives/6143; DOI: https://doi.org/10.4000/chinaperspectives.6143

Top of page

About the author

Mylène Gaulard

Mylène Gaulard is Maître de conférences (lecturer) in Economics at Université Pierre Mendès France – Grenoble 2.
Centre de Recherche en Économie de Grenoble (CREG), Bureau 529, 1241, rue des Résidences, 38400, Saint Martin d’Hères, France (mylene.gaulard@gmail.com).

Top of page

Copyright

The text and other elements (illustrations, imported files) are “All rights reserved”, unless otherwise stated.

Top of page
Search OpenEdition Search

You will be redirected to OpenEdition Search