The Chinese government hopes to boost the sluggish housing market through urban village renewal, which involves demolishing old communities and building new ones. However, British media reported that residents of urban villages are now demanding more compensation for demolition. , and private developers are also demanding higher compensation for demolition.BenefitWeibo’s reluctance to participate has made the urban village transformation process difficult.
The British Financial Times reported on the 18th that urban villages broadly refer to some old communities surrounded by high-rise buildings in the process of urban development. Houses in the communities are old and environmentally poor, and have also been accused of hindering urban development.
In recent years, China has transformed urban villages into shopping malls, office buildings and residences, which is seen as one of the important measures to boost the housing market.
like 2015BeijingThe declining housing market was saved through urban village renewal. Local governments obtained low-interest loan assistance and spent trillions of yuan to demolish and rebuild urban villages. Native residents of urban villages used demolition compensation fees to buy houses.
This year, the Chinese government has mentioned the transformation of urban villages at least three times in important meetings, including a meeting of the Political Bureau of the CPC Central Committee in July, which stressed the need to increase the construction and supply of affordable housing. Was mentioned, “actively promote the transformation of urban villages, and revitalize the transformation of a variety of vacant properties.”
According to estimates by Donghai Securities, there will be at least 10 million housing units in urban villages in China’s 21 largest cities by the end of 2022, the report said. However, the transformation process of urban villages is difficult, which hinders the improvement of the housing market.
The report said that in the past, real estate developers bought houses at low prices in urban villages and then rapidly converted them into high-end residential areas or shopping malls, and made high profits from them.
But now the situation is different. Residents of urban villages, like residents of Longzhuyuan, an older community in Shanghai, are demanding higher compensation for the demolition. There was an incident of pipe breakage and foundation subsidence in Longzhu Garden. The government provided three houses worth RMB 4 million (about US$548,000) each in Longzhu Garden as compensation.
But a resident surnamed Wang in Longzhu Garden said: “Until the government gives me 20 million yuan in demolition funds, I will not move.” He said the renovation should not be at the expense of the interests of local residents. Now officials can no longer afford to be transferred. He doesn’t mind waiting a few more years for a better compensation package.
The report also notes that to protect traditional communities, many cities limit the number of old houses that can be demolished. The Chinese government demands that urban villages be converted into affordable housing, which also leads to lower profits for developers.
These factors make it difficult for private developers to turn a profit as quickly as before from the transformation of urban villages, making them no longer willing to participate. Some state-owned developers and local governments benefit from cheap loans. ArefinancingPlatforms are being encouraged to participate in the transformation of urban villages.
However, a staff member of Jiangyang Xinqicheng Construction and Development Co., Ltd., the local government’s financing platform, clearly stated that the company’s involvement in the reconstruction of a historic district was motivated by political rather than economic considerations. Xinqicheng borrowed 790 million yuan from the Bank of China last month to participate in the project.
As China’s economic outlook weakens, local government financing platforms are also struggling to grapple with rising debt and sluggish performance.
An executive of a state-owned developer in Xi’an said the company lost more than 200 million yuan due to an old town renewal project two years ago and believed the government should pay more for urban village renewal. Must find a viable business model for.
A China Development Bank official said the latest urban village renewal campaign will cover 35 cities and attract a total of 9 trillion yuan of investment from developers over the next five years. “This is the only one in China’s economic stimulus plan that has had little impact so far. Highlight.”