The average housing price in 100 major Chinese cities fell for the fifth consecutive month in January 2012, as China’s property market continued to slow, according to The Wall Street Journal. This news seemed like a sigh of relief to the Chinese young generations.
A question mark may be raised in your head: what does the housing market have to do with China’s young generation? Before answering this question, it is worth mentioning that in China, property ownership does not mean land ownership as it does in the U.S. According to Chinese Law, property ownership is similar to a land-use right which in the case of residential property, expires after 70 years (40 years for commercial property). The countdown begins on the date that the real estate developer signs for the land, and not on the homeowner’s date of purchase. So, why does there exist such zest for real estate?
America’s idea of home can be expressed in the phrases “Home is where the heart is,” or “Home is where you hang your hat,” while China’s traditional version of the saying is, “Home is where your house is.” The worldwide real estate bubble collapse from 2008-2009, which has cooled down China’s property prices. With this cool down, however, the younger generations of the Chinese population are still under immense pressure when it comes to purchasing property. Today, when a Chinese young couple gets married, the first thing they are expected to consider is purchasing a home, while the subsequent questions are: “When do I buy?”, “Where do I buy?”, “How can I afford this?” However, owning a home comes first and foremost, while the details of attaining a home are put off as an afterthought.
Chinese housing prices hovered high, despite the housing collapse as compared to international levels. An example of these astronomical prices was a one bedroom, one bath, 180 square ft. condo-style unit in Beijing’s Chaoyang District in 2010, which sold for USD $57, 000 or $1,044 per square meter. An additional example for married couples with one child and live-in in-laws, was a two bedroom, one bath, 328 square feet condo-style unit in the Chaoyang District, which sold for $287,000, or $2,800 per square meter in 2010. Unfortunately, an overwhelming majority of urban Chinese young employees found it impossible to afford the elevated home prices because they were unable to make wages to pay for the homes and to compete with other nations.
Housing questions come after questions of social abnormalities. Young couples break up routinely directly before their wedding day due to this difficult and forced housing issue. This issue also forces young women to only consider potential male suitors who “meet the mark,” while young men prefer to delay their marriage due to the inability to pay for the down payment and mortgage loans.
China has a long way to go when it comes to providing accommodations for its 1.3 billion citizens. Although one clear problem lies with China’s resources to construct the “hardware”- the actual property, the country’s development cannot continue without also upgrading its “software”- people’s beliefs that a house is a place for living, and not a symbol for love.