Rental housing market needs time to develop

The rapid increase in house rents has drawn wide public concern, with some people blaming it on speculation and monopoly in the rental housing market. But we should not judge a market economy issue using ideology, because that would neither promote the nascent rental housing market nor meet the people's housing demand, as advocated by the government.

There are two major economic reasons for rising house rents - increase of demand, and shortage of supply.

On the demand side, during the academic graduation season, mostly in August and September, many college graduates look for accommodation outside campuses after leaving their dormitories. That raises the demand for rental housing, which in turn pushes up house rents. But this is a short-term seasonal factor.