This report reviews the existing literature on China’s housing policy and its housing finance system. Three issues will be discussed. First, we will briefly review the history of China’s housing reform, which began in 1980. Today China has completely transformed from a centrally planned public housing system to a market-oriented housing industry. Reviewing this process will help us understand China’s housing policy choices, since most of them were developed to facilitate this transformation.

After reviewing the historical transformation of China’s housing system, we will then discuss the framework of China’s current housing policy. In particular, we will discuss the three major programs that the Chinese government has developed to make housing more affordable for its citizens: the Economical and Comfortable Housing program (ECH), the Housing Provident Fund program (HPF), and the Cheap Rental Housing program (CRH), which have become the three pillars of China’s affordable housing system.

In addition to developing these affordable housing programs, the Chinese government has also made significant efforts to develop its housing finance system from scratch. Thus our third section will discuss China’s housing finance system. We will first review how China’s housing finance system has been restructured by the housing reform. We will then describe China’s emerging mortgage market, which has become a powerful engine for the country’s booming housing development and sustained economic growth (Deng and Fei 2008).