In less than 20 years the housing system in China has been transformed from one based predominantly on the public provision of housing to a market-based system, to the extent that more than 80% of households in urban China are homeowners. The sheer scale of this change, compressed into such a short time, is impressive. However, the move to a commodified system has not been problem free. Indeed, the twin issues of displacement and, more generally, affordability are coming increasingly to the fore, resulting in significant policy shifts since 2010 toward the promotion of low-end housing for lower middle- and low-income groups.

This article examines these issues through a detailed analysis of the implementation of the indemnificatory housing policy in Nanjing, and highlights the complex and often contradictory practice, this article adopts a case study approach to argue that even after the restructuring by the Chinese state of housing provision in 2010, accessibility to adequate and affordable housing remains a major challenge. In the context of the economic downturn, urban neo liberalization has intensified in China resulting in changing housing tenure, inner city gentrification, direct displacement, and exclusionary displacement. This has been driven by the state actively using housing to stimulate the real estate market and, in the process, creating new urban inequalities. This approach to urban governance, which might be conceptualized as a crisis of crisis management (Jones & Ward, 2002), is the result of a complex relationship between economic crises, neoliberal reforms, housing inequalities, and the activities of the Chinese national/local states in the housing market.