Chinese housing companies that are insolvent or can no longer operate must file for bankruptcy or restructuring in line with the country's laws and market rules, and those that continue to act against the interests of the people will be punished, a senior official said on Saturday.

 

Ni Hong, minister of housing and urban-rural development, said that China will ramp up efforts to build a new development model for real estate, solve the difficulties the market faces and bolster its sound and steady development.

 

Ni made the remarks at a news conference held on the sidelines of the two sessions, the annual meetings of the nation's top legislative and political advisory bodies.

 

The minister said China will effectively allocate the resources of people, houses, land and funds. People's demands should serve as the basis for the country's housing plans, which in turn will be used to plan out the use of land and funds, he added.

 

He also stressed efforts to improve government-subsidized housing, with a focus on exploring new ways to increase the number of such housing units for sale. This constitutes a major move to improve the country's housing regulation and supply system.

 

Despite undergoing a period of transition, China's real estate sector still enjoys great potential and space for development in the mid to long term. There are currently more than 30 billion square meters of urban housing in the country waiting to be upgraded and restored, Ni added.

 

Experts said they still see great potential in China's real estate sector and expect the government's new moves to take effect in getting the subdued market back on track.

 

Zhou Maohua, a macroeconomic researcher at China Everbright Bank, said the reasonable allocation of real estate resources will promote the healthy and stable development of China's housing market.

 

"It will also significantly contribute to the financing, sales and efficient land use in the sector," Zhou said.

 

Wang Xingping, senior analyst of corporates at rating agency Fitch Bohua, said the country's real estate sector is expected to gradually pick up this year.

 

Wang said that investment decline in the sector is very likely to narrow, and that housing demand will expand as people's incomes increase.

 

Ni, the minister, also said that China is well poised to advance its urban renewal process steadily this year, with about 50,000 old urban residential compounds set to be renovated. These residential compounds will be equipped with elevators, parking lots and accessible and elderly-care facilities.

 

He said the country plans to renovate more than 100,000 kilometers of aged underground pipelines this year and use digital means to strengthen the real-time monitoring of major urban facilities.