According to China Business News, the mayor of Qingdao, Shandong Province, said this week that housing prices should not be solely decided by the market and his government will take measures to control them.

Qingdao has been a city with housing prices rising at the highest rate in the country. In the fourth quarter of 2004, its housing prices jumped by 19.8 percent. The former Party secretary of Qingdao Du Shicheng used to say that the high housing prices could well upgrade the image of the city.

Actually Du's concept of city management has been implemented in many cities in recent years. Some regional officials tend to increase the prices of land, housing, water and gas for better profits.

The price hike of housing has burdened numerous medium- and low-income families. The increased expenditure on housing has restricted overall domestic consumption. The central government's control measures just cannot achieve the expected results.

Governments at all levels should realize that it is their responsibility to solve the housing issue. The government should provide low-price and low-rent housing to low-income earners. Housing is a daily necessity, the demand for which will not be greatly affected by price. The scarcity of land supply has determined the scarcity of the housing supply. Therefore speculators can easily increase housing prices for fat profits if there is no government intervention.

Governments at all levels should take up their responsibilities to adjust the housing market and crack down on speculative activities. It should be the government's basic target to let all people have their homes.

(China Daily 01/26/2007 page10)