China's Land Sales Skyrocket 6,700-fold in 21 Years

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There are some staggering figures from a Tsinghua University professor on land-sales across China. Some say it explains the push for land grabs by authorities, and high property prices.

The value of land sales in China has increased by more than 6,700 times in just over two decades—that's according to a Tsinghua University professor. This reflects soaring realty prices across China, and how local authorities are relying more on land transactions for income.

Professor Guan Qingyou is the director of Tsinghua's Center for China Studies Energy and Climate Project. Last week, he posted on his microblog account that land sales across China increased from 70-million dollars in 1989, to a staggering 470-billion in 2010. That's more than a 6,700-fold increase in just 21 years.

Guan compiled his figures from publicly available official statistics. He also found that the relative portion of land sales as a source of revenue for local authorities increased by more than 300 times. In 1989, land revenue accounted for just 0.24% of overall revenue for local governments. Last year, that ratio skyrocketed to 74%.

Guan's data has sparked an online discussion. Some believe this heavy reliance on land revenue explains authorities' illegal land grabs across China and high property prices.

Economics professor Chen Guofu believes Chinese authorities are using land transactions to cash in at the expense of ordinary citizens.

[Chen Guofu, Economics Professor]:
"In our country, the government has no restrictions on its land acquisition powers. There are no adequate legal protections for the public's property rights. So the government is able to reap huge benefits in the process of acquiring and selling land."

Guan and others want the Chinese regime to reign in property prices by reducing reliance on land revenue. Some believe central authorities have made the problem worse by taking the bulk of tax revenue from local authorities—local authorities who then pursue other sources of income through things like aggressive land policies.

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News & Politics

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• china
• land
• sales
• land sales
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• prices
• revenue
• profits
• economics

[modernfreestyle]

Can you say "real-estate bubble"?

[1eyednewt]

Sounds simular to what FDR did with gold in the 30's! Confiscate it all at 20 bucks an ounce, then raise the value to 36 bucks!