Multi-level housing system for accelerating urban housing reform in China

For accelerating the urban housing reform, the 'multi-level housing system' has been launched by the Chinese government. The primary objective is to supply different types of affordable urban housing to different income groups so as to accelerate the commercialization process of the housing provision. In order to make the system works, the social-economic prerequisites need to be recognized. In China, there are obvious income differences among urban households, which can be measured by Gini Coefficient. An investigation of this study indicates that the income differences have been enlarging since the economic reform in 1978. This paper proposes a conceptual model for delineating income groups based upon the ratio of housing prices and household incomes. The conceptual model aims to provide a quantitative yardstick to classify urban households and hence their corresponding affordable housing types. Households with high income need to purchase fully commercialized housing and households of medium- and low-income groups will be provided with 'economy housing' with government's subsidies. Finally, recommendations on sustainable development of urban housing in China are suggested.