An Analysis of Housing Policy during Economic Transition in China

It has been more than ten years since intensified housing marketisation reform began in China. During this period, reforms have achieved some extraordinary outcomes: speeding up the development of real estate and improving levels of urban housing. At the same time, there have also been some undesirable effects, such as declining housing affordability, and worsening housing conditions for disadvantaged groups. Critically, the housing market is producing negative outcomes in terms of its social security functions. This paper analyses policy effects of the late 1990s housing marketisation reform in China and elaborates on the housing welfare system. The focus is a quantitative analysis of Beijing's social housing policies. Finally, we use the Nash Equilibrium to analyse the social welfare features of housing policy and suggest future policy directions.