【In the 1980s, Shanghai became the first pilot city for land leasing in the country, and played an important role in urban development in the process of reform and opening up.
As a promoter and witness of this history, what memories does Leung Chun-ying have? What would the healthy development status of the real estate market be envisioned at that time look like? What responsibilities should individuals and governments bear when dealing with housing issues? Readers who are interested in these questions may wish to find answers in the following interview. 】
[Oral Preface] Leung Chun-ying, born in Hong Kong in August 1954, is from Weihai, Shandong. He has served as an advisor to the Hong Kong Affairs Office of the State Council, Secretary-General of the Advisory Committee of the Basic Law of Hong Kong, Deputy Director of the Preparatory Committee of the Hong Kong Special Administrative Region, a member of the provisional Legislative Council of the Hong Kong Special Administrative Region, a non-official member of the Executive Council of the Hong Kong Special Administrative Region and a convener. He has won the Golden Bauhinia Star and the Great Bauhinia Medal of the Hong Kong Special Administrative Region Government. He was once the chairman of the Asia-Pacific region of Ded & Bank and a member of the Standing Committee of the 10th and 11th National Committee of the Chinese People's Political Consultative Conference. On July 1, 2012, he was sworn in as the fourth Chief Executive of the Hong Kong Special Administrative Region. In March 2017, he was elected as Vice Chairman of the National Committee of the Chinese People's Political Consultative Conference.
Location: Hong Kong Concierge Office
Interview: Wang Ande, Li Juejun, Yan Nanhai
Compilation: Yan Yanan
Wang Ande : In the 1980s, Shanghai began to launch the land use system reform. At that time, you were the land use system reform consultant of the Shanghai Municipal Government, helping us make reform breakthroughs. When we were doing this work together, I always remember a sentence you said: We are writing history and creating history, so the responsibility is very heavy. From 1985 to the present, China's economic development has entered a new stage. What do you think and comment when recalling this history?
Liang Zhenying : First of all, from a personal perspective, helping to reform the land use system and related housing system reform in Shanghai and other places in the mainland is an important one of the two things I have done in my life.
The day when people's lives end, when it comes to that time, you should think back on your life. What have you done for society? For me, there are two things: one thing is the return of Hong Kong, and the other is the reform of the land use system and the housing system in the mainland. Of course, this is not my job alone, let alone my credit. However, it is very happy and honored to be able to do this work with the Shanghai Municipal Government and many other friends, so that our people can own their own houses and the mainland industry and commerce can own their own real estate.
Through the land use rights leasing, local governments can obtain income from the lease payment and land sale, making urban development enter a virtuous cycle. The land is sold and the money comes in. Use this money to do infrastructure construction, develop more land, and then put it on the market. Based on this virtuous cycle, we Shanghai and other cities in the mainland can develop.
I often tell some foreign friends that the houses you see in Shanghai and other major cities in the mainland have been built in about 20 years. Because of the first land lease in 1988, the first batch of houses were built around 1991 and 1992. All houses were only over 20 years old, and few had a history of more than 30 years. After hearing this, they were surprised and felt that this was probably the fastest, largest and best-effect urbanization in human history.
There was no such construction technology in ancient times, but now we have it; in history, China did not have so many people, only ours today has more than one billion people. Therefore, since 1988, Shanghai has taken the lead in leasing land in the mainland, which has caused a great impact.
From January 25 to February 13, 1988, the drafting group of international bidding documents for plot 26, Hongqiao went to Hong Kong to study. The picture shows Wang Ande and Leung Chun-ying
Wang Ande : This is actually a completely new path of reform and opening up and economic development, allowing land as a means of production to return to its nature, so that it can have both commodity attributes and can be used effectively as an economic leverage.At the beginning, domestic land use was free of charge. If you want land, you had to report it, and in the end it was used ineffectively. After this reform was promoted, it not only allowed the government to make money, but also changed people's ideas. Including your suggestion to Mayor Zhu Rongji to carry out housing system reform, which is a related aspect of two elements. After these two reforms were launched, it has been more than 30 years. Looking back, the owners have had a lot of economic momentum. Without this economic momentum, it is hard to imagine that we can achieve what we are today.
Until now, I remember it very clearly, and you worked very hard at that time. One day on a heavy snowy day, you flew over to help us work together. We write bids in Hong Kong, each draft is written by you. You not only modify it personally, but also translate all the English texts by you. Later, when we published and recommended customers, we used all the English manuscripts you translated.
In this process, you and a large number of reform workers have worked together to promote this matter, and have a lot of interactions with senior leaders such as Mayor Zhu Rongji, Deputy Mayor Huang Ju, Deputy Mayor Ni Tianzeng, and Deputy Secretary-General Xia Keqiang, so they often ask about Mr. Liang's situation after the meeting.
I remember when the Pudong development was in Pudong, Huang Ju told me, hurry up and find some time to ask Mr. Liang to come. The Pudong Development Leading Group of the Shanghai Municipal Government wants to invite you as a consultant. The main reason is that your ideas and ideas can give us a lot of inspiration and discussions in our reform work. I believe that you will have many wonderful and unforgettable memories in your interactions with them, right?
Lu Jiaozui before the development of
Liang Zhenying : First of all, from my personal motivation, the land affairs are my major. After joining the work, I encountered the historical period of national reform and opening up. I had the opportunity to contribute a little bit of strength to the country's reform and opening up. I think this is a great glory for my life.
Let’s talk about some background. I studied in the UK from 1974 to 1977, and I studied land management, that is, measurement. In the Bristol where I went to school, there are not many international students in mainland China, mainly from Hong Kong, and there are also some overseas Chinese children from Singapore and Malaysia . We organized a Chinese alumni association and I also became a vice president.
At that time, our international students often gathered together to talk about national affairs, often in the middle of the night. At that time, many of our international students went to the Chinese Embassy to knock on the door, saying that we were studying in the UK, some were studying aerospace engineering, some were studying physics, and I was studying measurement, and did I have the opportunity to return to China to work? The Embassy was very kind to us at that time, saying that the national conditions are not met yet, and it is very good for you to have this enthusiasm. When the national conditions are met, you are welcome to return to China.
I left the UK in 1977. Among our people, there is a Hong Konger named Feng Guoguang, who is a few years older than me. When I was in my undergraduate degree, he was already doing postdoctoral research, and he was engaged in physics. In 1979, he went to Beijing and worked as an assistant researcher at the Institute of Physics, Chinese Academy of Sciences. He brought the money back to work.
I returned to Hong Kong. In 1978, with a group of professionals from Hong Kong, I went to Shenzhen to help with planning, and later to Shanghai to help with reforms in both land and housing. Although I have some time and money sacrifices, it is nothing compared to me, my classmate. He worked in Beijing for 10 years from 1979 to 1989, earning a little salary. He just retired from , Hong Kong University of Science and Technology, and is a professor in the Department of Physics. For me, having this opportunity to contribute my own learning and strengths is a very important part of my life.
Looking back now, in the past 30 years, Shanghai and other mainland cities have achieved good results in real estate market construction, land use system reform and housing system reform. I am really happy. Looking back on many stories during my time working with you in Shanghai, what impressed me most about my interactions with previous leaders in Shanghai in land reform and housing system reform? Shanghai has a high understanding ability on this issue, a high level of execution, and does a good job. In addition, he is also very determined in politics. We are just giving a little advice technically.
I remember the first time Shanghai was engaged in land lease, in early 1988, and we drafted this bid together. I proposed an idea at that time, and wanted to make an English manuscript. I said that one day Shanghai will be an international city in our country. My friends in Shanghai probably thought I was polite or complimenting Shanghai.
We first leased land. At that time, the real estate market had not been established, but one day, many foreign capital would come to Shanghai to invest in real estate. The first time I did it, I would not bring in all Western funds immediately, but it would be internationalized for the first time, so we made an English translation. Shanghai leaders also agree with this statement, so we made a bilingual book for the first time. I should have read this right. (Laughs)
Wang Ande : This is a big breakthrough. Not only is it technically a bilingual, but it also gives us a conceptual inspiration: this market must be established according to the standards of the international market, and the requirements were very high at that time. But looking back now, if you don’t take this step and move forward and take over the market later, the speed will be slow and you may miss development opportunities.
Leung Chun-ying : I remember that time, I helped send the press release in Hong Kong. At that time, there was a radio station in Australia who was very interested and said that socialist China was going to engage in real estate. They felt that it was newsworthy, so they called my Hong Kong office and interviewed me on the phone. Therefore, it is still appropriate for us to carry out some international promotion activities.
On December 7, 1989, Leung Chun-ying attended the Shanghai real estate market survey report press conference held by Shanghai Industrial Co., Ltd. in Hong Kong
Li Juejun : Shanghai is an international bidding, and we are the first in the country to do it.
Wang Ande: The first piece of land in Shenzhen was auctioned to China as a land allocation, but the price must be used as the target. At that time in Shanghai, Mr. Liang helped us make bids together, and even how to determine the base bid was done under your guidance, and then helped translate and make the English version. You just mentioned Australia. There is a stack of directories in the information we have saved, showing how many people you have helped us send bids to Australia, Hong Kong, the United States and other places around the world. These history has records. It is more of a promotion than a promotion. The significance of publicity is much greater than direct customer bidding, because it is the first time.
Liang Zhenying : When we first bid, we should not talk about real estate developers in Western countries. Even big real estate developers in Hong Kong would not dare to start immediately. They still lack confidence in the relevant systems and policies. But later, we learned that all the major Hong Kong real estate developers have investments in mainland China, and some of them account for almost half of the total assets.
Wang Ande : Not only did you help us get on track when we first bidding, you also mentioned a few important things, such as real estate registration issues and real estate property mortgage issues. You also wrote a letter to Mayor Zhu Rongji by yourself, suggesting that the first real estate market survey in mainland China should be carried out, and all the past teachings and future predictions should be announced. Mayor Zhu Rongji attached great importance to it, approved it himself, and allocated funds to us, and the funds were also very tight at that time. You sent someone to help us conduct investigations and ask questions about professional training. Therefore, our Shanghai also sent the first group of people to study in Hong Kong. Looking back, this reform is supporting and in-depth, not about the matter, but has helped us a lot in establishing a system and system.
Liang Zhenying : At that time, I proposed several concepts. It was also a relatively new concept for Shanghai at that time. First, we need to develop the real estate market, and the market economy is the information economy. In other words, in the market, all investors, including buyers, sellers, landlords, and tenants must have relatively complete, reliable and transparent information, so that they can decide whether to buy this land, what price to buy, after buying it, or repair a hotel or an office building on this land, etc., and this work can only be done by the municipal government because the government has mastered this material.In addition, you have to start from a young age, because after the market develops, it will be difficult to do research. So at that time, Shanghai conducted the first national real estate market survey and distributed and disclosed this information to the public.
Wang Ande : I remember you came twice to help us discuss the revision draft, and also sent two colleagues, Lin Zengrong and Fang Xuewei, to participate. It was very difficult at that time because many government agencies in the mainland did not have this set of information; with these data, it is still a question whether it can be made public. Finally, the release of these information is approved by the municipal government. Today, these are very common market practices.
Li Juejun : I remember Mr. Liang taught us a class and taught us how to do research. We didn't understand it at the time, so we were very impressed.
Liang Zhenying : In addition, I also mentioned a concept, which is about public housing. At that time, I proposed that considering that the public housing rental income is very low but the maintenance and management costs are relatively high, as a landlord, public housing is not an asset, but is actually a liability. At that time, it was proposed whether some public housing could be sold at a relatively low price that suits the purchasing power of the people. After they sold it, they had their first house. In this way, after three or five years, their family's economic environment improved, they could sell the house and buy a new house.
The cultivation of the demand for buying a house is very important. Because of the first house, the market formed by taking out the first house three or five years later was formed. For developers who bought land and built houses under the land lease system, there were buyers, which could form a market turnover. This matter was promoted in Shanghai and was very successful. So I think the housing ownership rate in Shanghai is relatively high now, higher than that in Hong Kong.
Shanghai old public housing
Wang Ande : Yes, the housing ownership rate of Shanghai residents now reaches more than 70%. In addition to the relatively low housing ownership rate of migrant populations, almost all residents with fixed household registration have houses.
Leung Chun-ying : In addition, I also provide Hong Kong experience as a reference. Politically, as a landlord, the government can easily conflict with the people who are homeowners. I remember that at that time, I mentioned some Hong Kong experience. For example, if you live in a public housing, a certain family has broken water and no water is used one day, so they go to the management office to report. As a government agency, there must be no residents who go downstairs to find a craftsman to repair it so conveniently and quickly. After waiting for a day or two, no one came to repair it. On the third day, he became impatient and went out to find local public opinion representatives. The person who came may be a small district councillor , so he went to the management office to slap the table. The management office at least repaired it for him, and the district councillor would get the points. Gradually, local residents formed a relationship with local public opinion representatives, which often became a force against the government. So, from a political point of view, many public housing is a kind of debt and a kind of burden. So at that time, I proposed this idea in Shanghai, selling these public housing to residents, which would also allow residents to have their first property in the house.
Wang Ande : I participated in this conversation between you and Mayor Zhu at that time. After the conversation, I sent the guests away. I remember Mayor Zhu said that the conversation with you was very inspiring to him. He said that the reform of the housing system seems to be not just an economic issue in selling houses, but also a social and political issue. At that time, he asked Deputy Mayor Ni Tianzeng and Deputy Director Ye Bochu, who was in charge of housing reform in the Construction Committee, to quickly post the housing reform plan for the people in Shanghai to discuss it, so that everyone can understand the background, role of housing system reform and the benefits to the people, and to turn pressure into motivation and let everyone participate. This is a very important reform that mayor Zhu mobilized the whole society to discuss during his work in Shanghai.
Liang Zhenying : In addition, you mentioned the issue of property rights just now. I think in this regard, the establishment of the property registration system has not been fully completed in the mainland real estate market, and this work should be continued, which is very important.Real estate is actually the property rights of buildings and land. The other side of this property rights is obligation. Everyone who owns a house has their own set of rights and obligations.
The simplest, for example, how to share management costs in a building? There is no elevator at all in the shop on the first floor, so is the cost of the elevator shared? People living on the second and third floors may say, I take the elevator upstairs, and I don’t take the elevator downstairs, so how should I calculate my fee? All of these should be set up in the form of contracts and contracts, and made public to third parties, because many rights and interests related to real estate are the rights and interests of third parties.
When I was giving a speech, I also mentioned some examples. For example, if the house is mine, I rented it out, and I am selling the house now, the buyer and seller are the first and second parties, and the third party is the tenant. If I sold the house to you but didn't tell you at all that a lease has been signed in the house, then when you accepted the house, someone ran out and said, "I have signed a lease with the seller for this house, and I have to use this house here, what should I do?" The third party can be a tenant or a bank (he borrowed money from the house, and the house is his collateral), and the resolution of the rights and interests of the third party is nothing more than an announcement of the world.
announces the specific practice of the world, which is to have a place where everything is concentrated in the government agency to register. Since you want to announce the world, you must be completely transparent and anyone can come to check it. This should be said to be done in Hong Kong in a relatively complete way. So I also proposed this idea to Shanghai at that time. Of course, these tasks are much more complicated than doing basic construction such as "seven connections and one level". I think this work should continue today.
Wang Ande : I remember when you helped Shanghai to launch reform, you raised this question and we also issued corresponding regulations, but in terms of actual content, operation depth and integrity, there is still a big gap compared with Hong Kong. After that, Shanghai's real estate market expanded rapidly and this job failed to fully keep up. Now the issue of collective land rights and interests has also been put on the agenda. We look forward to the introduction of more complete regulations on state-owned and collective real estate asset registration in the near future.
Liang Zhenying : This is very good, it has something to do with the value of our mainland real estate. In addition to dependent on geographical location, surrounding planning and supporting facilities, property rights are also an important factor affecting value. Because the lower the risk of a property right, the higher its value. At the same time, the faster the circulation of property rights, the easier it is, the higher its value. What are some people who have bought a house worried about? I am worried that the house will take a long time to sell, or when it is sold, the buyer will feel that there is a certain property risk and will give a discount. Therefore, if we can formulate a complete property registration system, the value of mainland real estate will increase.
Wang Ande : This is very related to the interests of the people, because this system protects not only the rights and interests of third parties, but also improves the value of the people's real estate, which is what everyone is looking forward to.
Liang Zhenying : Do a good job in property registration and announce rights, obligations, etc. to the world, so that many people know in advance, rather than afterwards, can avoid causing conflicts and contradictions. Past experience shows that if there is no legal means to prevent the conflicts of property rights, it will become a means of solving the problem by force; if the means of force are not resolved well, it will be solved by political means. If all of them are returned to the country, don’t argue. So I see that property registration is the important next step.
Wang Ande: I just heard you say that Shenzhen and Hong Kong will conduct in-depth research on these issues in Qianhai and the development zones of the Free Trade Zone and create some new experiences. We are very looking forward to it.
Perhaps after these experiences are released, it will be a new practice that can drive all aspects of the country to learn, learn from and improve.
【In the 1980s, Shanghai became the first pilot city for land leasing in the country, and played an important role in urban development in the process of reform and opening up.
As a promoter and witness of this history, what memories does Leung Chun-ying have? What would the healthy development status of the real estate market be envisioned at that time look like? What responsibilities should individuals and governments bear when dealing with housing issues? Readers who are interested in these questions may wish to find answers in the following interview. 】
[Oral Preface] Leung Chun-ying, born in Hong Kong in August 1954, is from Weihai, Shandong. He has served as an advisor to the Hong Kong Affairs Office of the State Council, Secretary-General of the Advisory Committee of the Basic Law of Hong Kong, Deputy Director of the Preparatory Committee of the Hong Kong Special Administrative Region, a member of the provisional Legislative Council of the Hong Kong Special Administrative Region, a non-official member of the Executive Council of the Hong Kong Special Administrative Region and a convener. He has won the Golden Bauhinia Star and the Great Bauhinia Medal of the Hong Kong Special Administrative Region Government. He was once the chairman of the Asia-Pacific region of Ded & Bank and a member of the Standing Committee of the 10th and 11th National Committee of the Chinese People's Political Consultative Conference. On July 1, 2012, he was sworn in as the fourth Chief Executive of the Hong Kong Special Administrative Region. In March 2017, he was elected as Vice Chairman of the National Committee of the Chinese People's Political Consultative Conference.
Location: Hong Kong Concierge Office
Interview: Wang Ande, Li Juejun, Yan Nanhai
Compilation: Yan Yanan
Wang Ande : In the 1980s, Shanghai began to launch the land use system reform. At that time, you were the land use system reform consultant of the Shanghai Municipal Government, helping us make reform breakthroughs. When we were doing this work together, I always remember a sentence you said: We are writing history and creating history, so the responsibility is very heavy. From 1985 to the present, China's economic development has entered a new stage. What do you think and comment when recalling this history?
Liang Zhenying : First of all, from a personal perspective, helping to reform the land use system and related housing system reform in Shanghai and other places in the mainland is an important one of the two things I have done in my life.
The day when people's lives end, when it comes to that time, you should think back on your life. What have you done for society? For me, there are two things: one thing is the return of Hong Kong, and the other is the reform of the land use system and the housing system in the mainland. Of course, this is not my job alone, let alone my credit. However, it is very happy and honored to be able to do this work with the Shanghai Municipal Government and many other friends, so that our people can own their own houses and the mainland industry and commerce can own their own real estate.
Through the land use rights leasing, local governments can obtain income from the lease payment and land sale, making urban development enter a virtuous cycle. The land is sold and the money comes in. Use this money to do infrastructure construction, develop more land, and then put it on the market. Based on this virtuous cycle, we Shanghai and other cities in the mainland can develop.
I often tell some foreign friends that the houses you see in Shanghai and other major cities in the mainland have been built in about 20 years. Because of the first land lease in 1988, the first batch of houses were built around 1991 and 1992. All houses were only over 20 years old, and few had a history of more than 30 years. After hearing this, they were surprised and felt that this was probably the fastest, largest and best-effect urbanization in human history.
There was no such construction technology in ancient times, but now we have it; in history, China did not have so many people, only ours today has more than one billion people. Therefore, since 1988, Shanghai has taken the lead in leasing land in the mainland, which has caused a great impact.
From January 25 to February 13, 1988, the drafting group of international bidding documents for plot 26, Hongqiao went to Hong Kong to study. The picture shows Wang Ande and Leung Chun-ying
Wang Ande : This is actually a completely new path of reform and opening up and economic development, allowing land as a means of production to return to its nature, so that it can have both commodity attributes and can be used effectively as an economic leverage.At the beginning, domestic land use was free of charge. If you want land, you had to report it, and in the end it was used ineffectively. After this reform was promoted, it not only allowed the government to make money, but also changed people's ideas. Including your suggestion to Mayor Zhu Rongji to carry out housing system reform, which is a related aspect of two elements. After these two reforms were launched, it has been more than 30 years. Looking back, the owners have had a lot of economic momentum. Without this economic momentum, it is hard to imagine that we can achieve what we are today.
Until now, I remember it very clearly, and you worked very hard at that time. One day on a heavy snowy day, you flew over to help us work together. We write bids in Hong Kong, each draft is written by you. You not only modify it personally, but also translate all the English texts by you. Later, when we published and recommended customers, we used all the English manuscripts you translated.
In this process, you and a large number of reform workers have worked together to promote this matter, and have a lot of interactions with senior leaders such as Mayor Zhu Rongji, Deputy Mayor Huang Ju, Deputy Mayor Ni Tianzeng, and Deputy Secretary-General Xia Keqiang, so they often ask about Mr. Liang's situation after the meeting.
I remember when the Pudong development was in Pudong, Huang Ju told me, hurry up and find some time to ask Mr. Liang to come. The Pudong Development Leading Group of the Shanghai Municipal Government wants to invite you as a consultant. The main reason is that your ideas and ideas can give us a lot of inspiration and discussions in our reform work. I believe that you will have many wonderful and unforgettable memories in your interactions with them, right?
Lu Jiaozui before the development of
Liang Zhenying : First of all, from my personal motivation, the land affairs are my major. After joining the work, I encountered the historical period of national reform and opening up. I had the opportunity to contribute a little bit of strength to the country's reform and opening up. I think this is a great glory for my life.
Let’s talk about some background. I studied in the UK from 1974 to 1977, and I studied land management, that is, measurement. In the Bristol where I went to school, there are not many international students in mainland China, mainly from Hong Kong, and there are also some overseas Chinese children from Singapore and Malaysia . We organized a Chinese alumni association and I also became a vice president.
At that time, our international students often gathered together to talk about national affairs, often in the middle of the night. At that time, many of our international students went to the Chinese Embassy to knock on the door, saying that we were studying in the UK, some were studying aerospace engineering, some were studying physics, and I was studying measurement, and did I have the opportunity to return to China to work? The Embassy was very kind to us at that time, saying that the national conditions are not met yet, and it is very good for you to have this enthusiasm. When the national conditions are met, you are welcome to return to China.
I left the UK in 1977. Among our people, there is a Hong Konger named Feng Guoguang, who is a few years older than me. When I was in my undergraduate degree, he was already doing postdoctoral research, and he was engaged in physics. In 1979, he went to Beijing and worked as an assistant researcher at the Institute of Physics, Chinese Academy of Sciences. He brought the money back to work.
I returned to Hong Kong. In 1978, with a group of professionals from Hong Kong, I went to Shenzhen to help with planning, and later to Shanghai to help with reforms in both land and housing. Although I have some time and money sacrifices, it is nothing compared to me, my classmate. He worked in Beijing for 10 years from 1979 to 1989, earning a little salary. He just retired from , Hong Kong University of Science and Technology, and is a professor in the Department of Physics. For me, having this opportunity to contribute my own learning and strengths is a very important part of my life.
Looking back now, in the past 30 years, Shanghai and other mainland cities have achieved good results in real estate market construction, land use system reform and housing system reform. I am really happy. Looking back on many stories during my time working with you in Shanghai, what impressed me most about my interactions with previous leaders in Shanghai in land reform and housing system reform? Shanghai has a high understanding ability on this issue, a high level of execution, and does a good job. In addition, he is also very determined in politics. We are just giving a little advice technically.
I remember the first time Shanghai was engaged in land lease, in early 1988, and we drafted this bid together. I proposed an idea at that time, and wanted to make an English manuscript. I said that one day Shanghai will be an international city in our country. My friends in Shanghai probably thought I was polite or complimenting Shanghai.
We first leased land. At that time, the real estate market had not been established, but one day, many foreign capital would come to Shanghai to invest in real estate. The first time I did it, I would not bring in all Western funds immediately, but it would be internationalized for the first time, so we made an English translation. Shanghai leaders also agree with this statement, so we made a bilingual book for the first time. I should have read this right. (Laughs)
Wang Ande : This is a big breakthrough. Not only is it technically a bilingual, but it also gives us a conceptual inspiration: this market must be established according to the standards of the international market, and the requirements were very high at that time. But looking back now, if you don’t take this step and move forward and take over the market later, the speed will be slow and you may miss development opportunities.
Leung Chun-ying : I remember that time, I helped send the press release in Hong Kong. At that time, there was a radio station in Australia who was very interested and said that socialist China was going to engage in real estate. They felt that it was newsworthy, so they called my Hong Kong office and interviewed me on the phone. Therefore, it is still appropriate for us to carry out some international promotion activities.
On December 7, 1989, Leung Chun-ying attended the Shanghai real estate market survey report press conference held by Shanghai Industrial Co., Ltd. in Hong Kong
Li Juejun : Shanghai is an international bidding, and we are the first in the country to do it.
Wang Ande: The first piece of land in Shenzhen was auctioned to China as a land allocation, but the price must be used as the target. At that time in Shanghai, Mr. Liang helped us make bids together, and even how to determine the base bid was done under your guidance, and then helped translate and make the English version. You just mentioned Australia. There is a stack of directories in the information we have saved, showing how many people you have helped us send bids to Australia, Hong Kong, the United States and other places around the world. These history has records. It is more of a promotion than a promotion. The significance of publicity is much greater than direct customer bidding, because it is the first time.
Liang Zhenying : When we first bid, we should not talk about real estate developers in Western countries. Even big real estate developers in Hong Kong would not dare to start immediately. They still lack confidence in the relevant systems and policies. But later, we learned that all the major Hong Kong real estate developers have investments in mainland China, and some of them account for almost half of the total assets.
Wang Ande : Not only did you help us get on track when we first bidding, you also mentioned a few important things, such as real estate registration issues and real estate property mortgage issues. You also wrote a letter to Mayor Zhu Rongji by yourself, suggesting that the first real estate market survey in mainland China should be carried out, and all the past teachings and future predictions should be announced. Mayor Zhu Rongji attached great importance to it, approved it himself, and allocated funds to us, and the funds were also very tight at that time. You sent someone to help us conduct investigations and ask questions about professional training. Therefore, our Shanghai also sent the first group of people to study in Hong Kong. Looking back, this reform is supporting and in-depth, not about the matter, but has helped us a lot in establishing a system and system.
Liang Zhenying : At that time, I proposed several concepts. It was also a relatively new concept for Shanghai at that time. First, we need to develop the real estate market, and the market economy is the information economy. In other words, in the market, all investors, including buyers, sellers, landlords, and tenants must have relatively complete, reliable and transparent information, so that they can decide whether to buy this land, what price to buy, after buying it, or repair a hotel or an office building on this land, etc., and this work can only be done by the municipal government because the government has mastered this material.In addition, you have to start from a young age, because after the market develops, it will be difficult to do research. So at that time, Shanghai conducted the first national real estate market survey and distributed and disclosed this information to the public.
Wang Ande : I remember you came twice to help us discuss the revision draft, and also sent two colleagues, Lin Zengrong and Fang Xuewei, to participate. It was very difficult at that time because many government agencies in the mainland did not have this set of information; with these data, it is still a question whether it can be made public. Finally, the release of these information is approved by the municipal government. Today, these are very common market practices.
Li Juejun : I remember Mr. Liang taught us a class and taught us how to do research. We didn't understand it at the time, so we were very impressed.
Liang Zhenying : In addition, I also mentioned a concept, which is about public housing. At that time, I proposed that considering that the public housing rental income is very low but the maintenance and management costs are relatively high, as a landlord, public housing is not an asset, but is actually a liability. At that time, it was proposed whether some public housing could be sold at a relatively low price that suits the purchasing power of the people. After they sold it, they had their first house. In this way, after three or five years, their family's economic environment improved, they could sell the house and buy a new house.
The cultivation of the demand for buying a house is very important. Because of the first house, the market formed by taking out the first house three or five years later was formed. For developers who bought land and built houses under the land lease system, there were buyers, which could form a market turnover. This matter was promoted in Shanghai and was very successful. So I think the housing ownership rate in Shanghai is relatively high now, higher than that in Hong Kong.
Shanghai old public housing
Wang Ande : Yes, the housing ownership rate of Shanghai residents now reaches more than 70%. In addition to the relatively low housing ownership rate of migrant populations, almost all residents with fixed household registration have houses.
Leung Chun-ying : In addition, I also provide Hong Kong experience as a reference. Politically, as a landlord, the government can easily conflict with the people who are homeowners. I remember that at that time, I mentioned some Hong Kong experience. For example, if you live in a public housing, a certain family has broken water and no water is used one day, so they go to the management office to report. As a government agency, there must be no residents who go downstairs to find a craftsman to repair it so conveniently and quickly. After waiting for a day or two, no one came to repair it. On the third day, he became impatient and went out to find local public opinion representatives. The person who came may be a small district councillor , so he went to the management office to slap the table. The management office at least repaired it for him, and the district councillor would get the points. Gradually, local residents formed a relationship with local public opinion representatives, which often became a force against the government. So, from a political point of view, many public housing is a kind of debt and a kind of burden. So at that time, I proposed this idea in Shanghai, selling these public housing to residents, which would also allow residents to have their first property in the house.
Wang Ande : I participated in this conversation between you and Mayor Zhu at that time. After the conversation, I sent the guests away. I remember Mayor Zhu said that the conversation with you was very inspiring to him. He said that the reform of the housing system seems to be not just an economic issue in selling houses, but also a social and political issue. At that time, he asked Deputy Mayor Ni Tianzeng and Deputy Director Ye Bochu, who was in charge of housing reform in the Construction Committee, to quickly post the housing reform plan for the people in Shanghai to discuss it, so that everyone can understand the background, role of housing system reform and the benefits to the people, and to turn pressure into motivation and let everyone participate. This is a very important reform that mayor Zhu mobilized the whole society to discuss during his work in Shanghai.
Liang Zhenying : In addition, you mentioned the issue of property rights just now. I think in this regard, the establishment of the property registration system has not been fully completed in the mainland real estate market, and this work should be continued, which is very important.Real estate is actually the property rights of buildings and land. The other side of this property rights is obligation. Everyone who owns a house has their own set of rights and obligations.
The simplest, for example, how to share management costs in a building? There is no elevator at all in the shop on the first floor, so is the cost of the elevator shared? People living on the second and third floors may say, I take the elevator upstairs, and I don’t take the elevator downstairs, so how should I calculate my fee? All of these should be set up in the form of contracts and contracts, and made public to third parties, because many rights and interests related to real estate are the rights and interests of third parties.
When I was giving a speech, I also mentioned some examples. For example, if the house is mine, I rented it out, and I am selling the house now, the buyer and seller are the first and second parties, and the third party is the tenant. If I sold the house to you but didn't tell you at all that a lease has been signed in the house, then when you accepted the house, someone ran out and said, "I have signed a lease with the seller for this house, and I have to use this house here, what should I do?" The third party can be a tenant or a bank (he borrowed money from the house, and the house is his collateral), and the resolution of the rights and interests of the third party is nothing more than an announcement of the world.
announces the specific practice of the world, which is to have a place where everything is concentrated in the government agency to register. Since you want to announce the world, you must be completely transparent and anyone can come to check it. This should be said to be done in Hong Kong in a relatively complete way. So I also proposed this idea to Shanghai at that time. Of course, these tasks are much more complicated than doing basic construction such as "seven connections and one level". I think this work should continue today.
Wang Ande : I remember when you helped Shanghai to launch reform, you raised this question and we also issued corresponding regulations, but in terms of actual content, operation depth and integrity, there is still a big gap compared with Hong Kong. After that, Shanghai's real estate market expanded rapidly and this job failed to fully keep up. Now the issue of collective land rights and interests has also been put on the agenda. We look forward to the introduction of more complete regulations on state-owned and collective real estate asset registration in the near future.
Liang Zhenying : This is very good, it has something to do with the value of our mainland real estate. In addition to dependent on geographical location, surrounding planning and supporting facilities, property rights are also an important factor affecting value. Because the lower the risk of a property right, the higher its value. At the same time, the faster the circulation of property rights, the easier it is, the higher its value. What are some people who have bought a house worried about? I am worried that the house will take a long time to sell, or when it is sold, the buyer will feel that there is a certain property risk and will give a discount. Therefore, if we can formulate a complete property registration system, the value of mainland real estate will increase.
Wang Ande : This is very related to the interests of the people, because this system protects not only the rights and interests of third parties, but also improves the value of the people's real estate, which is what everyone is looking forward to.
Liang Zhenying : Do a good job in property registration and announce rights, obligations, etc. to the world, so that many people know in advance, rather than afterwards, can avoid causing conflicts and contradictions. Past experience shows that if there is no legal means to prevent the conflicts of property rights, it will become a means of solving the problem by force; if the means of force are not resolved well, it will be solved by political means. If all of them are returned to the country, don’t argue. So I see that property registration is the important next step.
Wang Ande: I just heard you say that Shenzhen and Hong Kong will conduct in-depth research on these issues in Qianhai and the development zones of the Free Trade Zone and create some new experiences. We are very looking forward to it.
Perhaps after these experiences are released, it will be a new practice that can drive all aspects of the country to learn, learn from and improve.
Leung Chun-ying : I really hope that, especially now, I am the Chief Executive of the Hong Kong Special Administrative Region, I really hope that it can promote all walks of life in Hong Kong, including the professional community and some of our retired civil servants, to put some time and energy into the mainland to contribute their learning and strengths. Now when I go to the mainland to do these jobs, the overall working conditions are much better than when I went to Shenzhen and Shanghai in the 1970s. So, I hope to organize and communicate more with both sides. I believe we have many places to learn from Shanghai. Regarding the issue of property registration, I see that there are many lawyers and some retired civil servants in Hong Kong who have the time, energy and experience to do this job well.
Wang Ande : We hope to learn your experience soon. You are very busy at work and have taken up so much time. We have too many questions to recall and discuss, and hope that we can continue to discuss next time we have the opportunity.
Liang Zhenying : OK, thank you!
Attachment
On October 8, 1986, Leung Chun-ying's speech at the Lions Club lunch.
It's own strength
Over the past decade, Hong Kong's economy has grown very considerable. To say that the economic growth is considerable, it is actually to summarize the society, people's livelihood, and all industries in industry and commerce are better than before. The progress of people's livelihood and industry and commerce is not easy to see on the surface, but the high-rise buildings, new skylines, new highways, and new municipal construction that have come with the development of the economy give people a strong feeling. Not to mention that foreigners who have been away for a few years and who have returned to Hong Kong, even Hong Kong people themselves, have never been to the new towns in the New Territories for a year and a half, will feel a new look. After all, the feeling mentioned above is emotional. If we sit down and search for information, the result will be more amazing than the emotional feeling. For example, at the end of 1975, the total number of private houses in Hong Kong, Kowloon and the New Territories was 357,000 units. Ten years later, at the end of 1985, this number increased to 592,000 units, which means that the total number of private houses has increased by two-thirds over the past decade. From another point of view, about 40% of all private residential units currently in existence have been completed within the past decade. While the highway of private residential buildings was completed in large quantities, the vacancy rate at the end of 1985 was only 3.7%, which clearly stated that most of the newly built residential units have become residences of Hong Kong citizens, solving some housing problems for Hong Kong.
The construction of private residential buildings has certainly relieved the pressure on housing problems for us, but the other side of private residential buildings is that thousands of families in Hong Kong have invested directly to improve their lives over the years, and through their own properties, they have indirectly improved the entire society.
The total value of private residential buildings completed in 1985 is approximately RMB 12 billion, and the average per capita is RMB 2,200 based on the population of Hong Kong of 5.5 million. The 30,000 families who became new owners last year, borrowed 80% of the loan, repayed 15 years, and calculated the annual interest rate of 75% per month. Each family repays an average of 3,000 yuan per month, and each family has to pay 2,000 yuan in interest alone.
As I said just now, Hong Kong's family self-built property makes indirect investment in social construction, and this indirect investment is also of great significance. A considerable part of the property price is the land price, and a considerable part of the private residential land is sold by the government. The annual income from the government's land sale is similar to the expenditure on public construction:
Note: From 1980 to 1985, the average land income was 6.1 billion yuan per year.
In other words, 30,000 newly-owner families each year also indirectly pay part of the expenses for public construction in society.
The newly completed private residential building worth 12 billion yuan last year is about 1.2 billion yuan per year, bringing the government an additional 60 million yuan in rate revenue every year. In addition, of course, there is a stamp duty of hundreds of millions of yuan when buying a property.
becomes 30,000 families of new owners every year. Buying a house to live in a stable life and living in your own business is not an easy task. Most families have to borrow from banks, and the loan amount is also very high. The monthly repayment amount, the interest part alone, has accounted for 30 to 40% of the total household income. The government has no funding or allowance of any kind.Friends who are responsible for building loans in the banking industry know the phenomenon of building thrift and frugality in most middle and lower-level families in Hong Kong.
No matter in any country, housing is an important part of people's livelihood. In our society, due to the high population pressure and the rugged terrain, the cost of opening up mountains and land is very high, and the price paid by citizens for housing is also very high. When necessary, the government provides funding to families that must provide help is the correct social policy. Citizens’ demand for housing cannot be simply described as a right, and they cannot treat all solving housing problems as social welfare. Hong Kong's development over the past hundred years, especially its economic takeoff over the past decade, has been the result of Hong Kong people's self-reliance. We do not rely on the assistance of any country. We do not move closer to any group politically or military, nor do we gain any economic benefits. Most of the production raw materials or daily needs that Hong Kong people need are bought at international market prices and then sold at international market prices. If some of the small owners who buy a house to live in every year no longer have the spirit of hard work and spend the money on consumer goods, and put the responsibility for meeting the needs of the house on the government, the housing problems in Hong Kong will be unimaginable. The total value of private houses completed every year is about 30% of the government's total income. If citizens all spread their hands to the government, who will the government spread their hands to?
is certainly necessary to provide public housing, but with the development of social economy and the increase in citizens' income, public housing policies, including rent policies, must be changed. Just as the government relaxes the rent control of private residential buildings every year and increases the expropriation and expropriation according to social needs, even if public housing is a social welfare, everyone should understand that no social welfare is permanent, whether it is social assistance or unemployment relief. When the economic ability of the beneficiary exceeds the specified level, there is no welfare that is inseparable from the rich and the poor.
The reasonable public housing rental policy of any society must be understood by the tenant's ability to pay rent. The rent cannot be set too high, so that the tenant cannot make a living. The same is true when the banking industry reviews the application for mortgage loan purchases; the monthly repayment amount of applicants cannot account for too much of the total family income, otherwise the bank will take greater risk of bad debts. Nowadays, the maximum ratio between the repayment amount set by a bank and the family income is 40%, which means that the monthly repayment of 5,000 yuan shall not exceed 2,000 yuan. Of these 2,000 yuan, two-thirds of the interest collected by the bank. In other words, interest expenses paid for housing account for 27% of income.
Between 1981 and 1985, the rent to income ratio of HAHK residents was between 4.6% and 6.5%.
The housing problem is certainly more complicated. It is not easy to execute because of the increase in income, and the right or wrong of the public housing tenants are required to rent additionally, or simply move out. However, everyone must distinguish between the specific difficulties during execution and the right and wrong of this issue.
This article is excerpted from the Party History Research Office of the Shanghai Municipal Committee of the Communist Party of China: "Icebreaker: A Person of the Eyewitness in Shanghai Land Leasing Pilot", Shanghai People's Publishing House, 2018.
Friends who are responsible for building loans in the banking industry know the phenomenon of building thrift and frugality in most middle and lower-level families in Hong Kong.No matter in any country, housing is an important part of people's livelihood. In our society, due to the high population pressure and the rugged terrain, the cost of opening up mountains and land is very high, and the price paid by citizens for housing is also very high. When necessary, the government provides funding to families that must provide help is the correct social policy. Citizens’ demand for housing cannot be simply described as a right, and they cannot treat all solving housing problems as social welfare. Hong Kong's development over the past hundred years, especially its economic takeoff over the past decade, has been the result of Hong Kong people's self-reliance. We do not rely on the assistance of any country. We do not move closer to any group politically or military, nor do we gain any economic benefits. Most of the production raw materials or daily needs that Hong Kong people need are bought at international market prices and then sold at international market prices. If some of the small owners who buy a house to live in every year no longer have the spirit of hard work and spend the money on consumer goods, and put the responsibility for meeting the needs of the house on the government, the housing problems in Hong Kong will be unimaginable. The total value of private houses completed every year is about 30% of the government's total income. If citizens all spread their hands to the government, who will the government spread their hands to?
is certainly necessary to provide public housing, but with the development of social economy and the increase in citizens' income, public housing policies, including rent policies, must be changed. Just as the government relaxes the rent control of private residential buildings every year and increases the expropriation and expropriation according to social needs, even if public housing is a social welfare, everyone should understand that no social welfare is permanent, whether it is social assistance or unemployment relief. When the economic ability of the beneficiary exceeds the specified level, there is no welfare that is inseparable from the rich and the poor.
The reasonable public housing rental policy of any society must be understood by the tenant's ability to pay rent. The rent cannot be set too high, so that the tenant cannot make a living. The same is true when the banking industry reviews the application for mortgage loan purchases; the monthly repayment amount of applicants cannot account for too much of the total family income, otherwise the bank will take greater risk of bad debts. Nowadays, the maximum ratio between the repayment amount set by a bank and the family income is 40%, which means that the monthly repayment of 5,000 yuan shall not exceed 2,000 yuan. Of these 2,000 yuan, two-thirds of the interest collected by the bank. In other words, interest expenses paid for housing account for 27% of income.
Between 1981 and 1985, the rent to income ratio of HAHK residents was between 4.6% and 6.5%.
The housing problem is certainly more complicated. It is not easy to execute because of the increase in income, and the right or wrong of the public housing tenants are required to rent additionally, or simply move out. However, everyone must distinguish between the specific difficulties during execution and the right and wrong of this issue.
This article is excerpted from the Party History Research Office of the Shanghai Municipal Committee of the Communist Party of China: "Icebreaker: A Person of the Eyewitness in Shanghai Land Leasing Pilot", Shanghai People's Publishing House, 2018.
