Let all Chinese live in peace and contentment (2)

16:41, September 22, 2009      

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Strive to stabilize housing prices – "People's understanding of the laws of the market economy itself is an important part of improving market economic reform."

Since the housing distribution system ended in 1998, China's real estate industry and market has boomed, and the public has become increasingly concerned about the volatility of housing prices. In particular, in recent years housing prices in some regions have risen too quickly, so Jiang is shouldering the significant responsibility of regulating housing prices.

As for the reasons behind the rise in housing prices, Jiang believes that enormous rigid demand and generally tight land supply and some market administration issues have led to a continuous increase in housing prices. "Following the commercialization of housing, it has objectively been very hard to avoid price fluctuations that are governed by an inexorable law. MOHURD hopes that housing prices remain stable. If prices increase or fall, the change should not be too rapid or dramatic. The government can keep housing prices relatively stable through regulation."

"Dramatic fluctuations in housing prices are neither good for society nor for the public," said Jiang. The public do not only complain when housing prices rise; when housing prices dropped last year, some people who purchased houses suffered from shrinking assets and complained bitterly. "At the time, we strove to take steps to stabilize the market and also tried to persuade people to accept it. We sought to stabilize housing prices on the one hand and on the other hand tried to make buyers understand that housing prices are inevitably volatile in a market economy. Housing buyers should be psychologically prepared for fluctuations."

Jiang said frankly that in the planned economy era, these things were unimaginable and nobody had these experiences. Nowadays, they are inevitable experiences. He added, "People's understanding of the laws of the market economy itself is an important part of improving market economic reform."
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