Property

Real estate scam

Corrupt officials blamed for high property prices

Ren: “Who threw that shoe?”

China’s ebullient property market is generating plenty of tales of woe: a woman dousing herself in gasoline trying to stop developers from flattening her home; single men rejected by women because they can’t afford to buy; and university graduates forced to live cheek-by-jowl in tiny accommodation.

So no surprise, perhaps, that culprits are increasingly being sought. And critics are pointing their fingers at government officials. In a recent article published in the China Youth Daily, commentator Xie Yuhang cited corruption as the biggest factor in the surge in property prices across the country.

Xie’s article – under the catchy heading “To Solve The Populace’s Housing Problems We Must Root Out Self-Enrichment by The Powerful” – pulls few punches. He says that apartments in government-subsidised housing projects are being snatched up by civil servants or people with connections, when they are supposed to be available for people who can’t afford homes on the open market.

For example, Xinhua reported in April that, of the 2,300 homes in the Century Park government-subsidised development in Xinzhou, Shanxi, 1,600 were distributed to local government workers rather than to low-income households. Many of the civil servants also seem to own other properties too. “Few of the government workers getting the [low-income] homes were that poor,” a local resident laments.

Fanning the flames are reports that a number of the residents living at the development drive home in BMWs and Audis each night.

In fact, many low-income housing projects aren’t being built for the poor. Even though the government has dictated that low-income homes must be smaller than 90 square metre (to keep the cost down for families) the rules tend to be ignored.

For instance, a woman in Beijing recently grabbed headlines when she posted photographs of her two-storey 300-square metre apartment within a low-income project. That is about 3 times the size of the standard unit stipulated, and far beyond the reach of poor households, says China News Net.

All of this, says Xie, points squarely to corruption, and undermines Beijing’s attempts to rein in property prices.

“Affordable housing is built not for the common people who couldn’t afford a place to live. Instead, it is being used to feather the nests of corrupt, powerful officials,” he says.

With another big increase in property prices reported this month, it looks like an issue that will continue to create bad feeling. Sometimes this can spill over. In one incident last week, Ren Zhiqiang, chairman of Huayuan Property, a Beijing-based state-run developer, had a shoe hurled at him during a property summit in Dalian.

Ren managed to dodge the flying footwear (much like an erstwhile American president). But there were shouts of “Bravo!” among the audience in support of the thrower.

The 59 year-old property supremo, nicknamed “Big Mouth Ren” by local media, has earned a reputation for some rather non-egalitarian outbursts, including “I build houses only for the rich” and “People who aren’t able to afford houses should return to their village.”

He was true to form in the aftermath of the incident too, telling reporters that his attacker was “economically inferior to housing slaves” (people who can’t afford downpayments on houses).

In an online survey following news of the shoe-throwing, close to three quarters of the 395,486 respondents at ifeng.com supported the assault. In the same survey, 55% of those who voted said that shoes should also have been thrown at the government officials standing behind Ren.


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