From Chinese Press

Rising rents cause worry

(China Daily)
Updated: 2011-02-21 07:35

Renting houses has become flourishing business because of rising rents. This will increase the number of people who form groups to rent houses, says an article in Beijing News. Excerpts:

The Provision on Commercial House Tenancy Administration took effect from Feb 1. But whether or not this provision will be implemented effectively largely depends on house rents. If the government wants to eliminate unlawful group rentals, it has to control the rising rents as well as provide more low-income housing units for the low- and medium-income groups.

But the current situation in Beijing is worrying. Rising living cost has forced people to continue renting houses in groups, which is not what relevant departments want. Weak implementation of the provision will run counter to its purpose and hurt low- and medium-income people who go in for group rentals to save money.

The increase in rents is very likely to drive more people away from big cities such as Beijing and Shanghai. The situation would be similar to that a couple of years ago. Rising housing prices and rents will control the inflow of floating population into big cities as the policymakers expect. But a city needs all kinds of talents for its development, and the consequences of keeping away potential contributors can be contrary to expectations.

High rents cannot be attributed to the real estate market. City officials should give a serious thought to the needs of tenants and create better living conditions for them. Perhaps more social security funds are needed to solve group rental problem.

(China Daily 02/21/2011 page9)