The Impact of Housing Reforms & the Real Estate Market on Urban Middle-Class Identity in China1. IntroductionAs a part of its rapidly-growing economic strength, China is experiencing a number of social shifts that force the country to confront a delicate balance of conflicting forces. Economic opportunities, increasing personal prosperity and globalization fuel China’s urban development and the expansion of the urban population throughout the country, but most notably in China’s “two capitals”: the political center of the country in Beijing, and the financial capital of Shanghai. The difficult balance that must be managed by the country is between the growing expectations and identity of the new Chinese middle class, the political aspects of planning and control, and the economic drivers that impact land and housing planning and use. The unique conditions within China are well-known to even the most casual observer, but bear summarizing to put the following discussion in context.
China is, of course, ostensibly a Communist country, with a political tradition – at least since the end of World War II – of planned economy and strict social control. Chinese traditions regarding family, gender roles, education and career, and particularly the handling of money are very strong; as one Shanghai banking executive points out, the deep Chinese aversion to debt has made the credit card business slow to get off the ground in China, simply because most customers cannot conceive of ‘carrying a balance’ and pay off their entire bill every month.
(Gross, 2009) Opposing these strong conservative forces in Chinese society is the push for a more liberalized and globalized economy, encouraged by the government and enthusiastically embraced by the people.
This has created a shift in China’s population towards the cities, which are now growing at an incredible rate. More importantly, the cities are populated with a growing middle class that did not even exist in any practical sense even 20 years ago; a middle class that has been exposed to and developed a taste for foreign goods and styles, and moreover, thanks to China’s economic success, has the resources to pursue those desires. This is reflected in the urban housing market just as it is in more mundane material aims like the latest clothing fashions from Europe or America, or the newest electronic gadgets.
Unlike those mundane goods, however, the urban residential real estate market is physically, and to some extent emotionally, reshaping the Chinese landscape. This essay will address three main questions about how the development of contemporary urban China – specifically, in Shanghai and Beijing – contributes to the emerging identity of China’s middle class. First, what is the state of the urban real estate economy in China, and how has the interaction between land and housing planning and reform and economic growth shaped this sector?
Second, how is the image of China’s emerging middle class shaped by and reflected in how residential real estate is marketed, and to what degree does globalization – which is reflected in the growing number of transnational professionals in the middle class – play a role? And finally, how do the images marketed to the real estate buyers reflect the globalization of Chinese cities and the people?