1. Real Estate Times: Among the  many real estate indexes released recently, there is no one indicating the average property price of last year. Shanghai's average housing price was 5,118 yuan (US$616.6) in 2003 and the just released index indicated that the property price of last year increased by 15.8 percent from a year earlier. Does that mean that we can get the average housing price from the two figures (5,118 * 15.8 %)? A spot check of 3,000 local households last December showed that more than 60 percent of local residents had their own homes. The proportion is different from what you released before. Can you explain it?

Cai Xuchu (Chief Economist with the Shanghai Statistics Bureau): All of you are concerned about the local real estate market. I will talk about three issues: first, a general judgment of the real estate market of last year; second, why the housing price released by the government statistics department disaccords with what local residents are feeling; third, a general prediction of the real estate market trend this year.

As to the first point, based on some statistical data, our general judgment on the existing real estate market: the demand and supply are both large, making growing contributions to the national economic growth. Last year, the added values of local real estate sector increased by 20.4 percent from a year earlier, accounting for 8.4 percent of the local GDP. Shanghai's economy grew by 13.6 percent last year, with 1.3 percent contributed by real estate industry, up 0.5 percentage point from a year earlier. The local real estate development further improves the residents' living standard and quality. Last year, residents had a living area of 14.8 square meters per capita, up one square meter from the previous year. A total of 92.5 percent of residents lived in apartment suites. 

However, there are still problems in the local real estate market, in three aspects:

First, there is a large and balanced demand and supply in the local real estate market, while demand is a bit greater than supply. Last year, construction of a total of 30.7619 million square meters of residential properties were completed, up 43.7 percent from a year before; a total of 32.3374 million square meters of residential properties (including both pre-sold and existing homes) were sold, up 38.5 percent from the previous year. Unsold housing areas declined by 51 percent to 1.2649 million square meters last year, with only 758,400 square meters of properties unsold for more than one year, down 21.9 percent from the previous year. According to the statistics from the Shanghai Housing and Land Resources Bureau, the ratio between supply and demand is 1:1.07, with demand a little greater than supply.

Second, the supply structure is reasonable, but the supply of ordinary residential housing is not enough. Last year, 55.6 percent of pre-sold homes were priced below 6,000 yuan per square meter; 28.7 percent were priced between 6,000-9,000 yuan and 15.7 percent were priced more than 9,000 yuan per square meter.

Third, the housing price growth slowed, but in certain areas, the prices grew too fast. Last year, prices of residential properties increased by 15.8 percent from a year before. The growth margin in the downtown area was much higher than that outside the city's Outer Ring Road, with the average price inside the city's Inner Ring Road rising by 27.5 percent while that outside the Outer Ring Road up 10.7 percent from the previous year.

The second piont: we release commercial home price statistics according to a certain formula, which  divides the total sales volume of  apartments by their total area, generating an average price. Such a composite average only reflects fluctuations in prices for apartments sold. According to the statistics released, we re-calculate to get an average home-sale price for 2004; which is 6,385 yuan per square meter, up 14.6 percent over 2003. Now we have another figure, 15.8 percent, which is the total sum calculated from nearly 300 current real estate samplings. It reflects the general changes in home prices. Therefore, the two figures, 14.6 percent and 15.8 percent, though different in sampling targets and calculation, both indicate the same rising trend in home prices.

One thing to point out is that the figure of 14.6 percent is calculated by comparable parameters, which includes homes sold both  on or before completion . Before year 2003, the home price growth figures only included the completed apartments which were in use. Since 2004, the calculation started to include the pre-sold homes, in order to reflect the sales prices more objectively.

Then why do people find obvious differences between the release and the situation they feel in reality? That's because it's only an average and I'd like to reason it in the following ways.
First, the supply of a great number of economy homes diluted the general price hike. The economy homes are those specially offered at low prices to the relocated families who were affected by the city's infrastructural constructions. The target beneficiary group is so small that most citizens don't feel the wave. But the total area of these apartments accumulated,  accounting for  19.7 percent of all the homes sold last year, such that the general price rise is obviously flatted.
Second, the commercial homes sold have distinguished price changes from regional differences. The homes outside the Outer Ring Road are sold in large quantities with only moderate price rises, greatly lowering the city's average home price. But as most of the local families are living inside the Inner Ring Road, or between the Inner Ring Road and Outer Ring Road, they can hardly feel the punch.

Third, the price rise that most people learn from the Internet are higher than in reality because some realtors fake contracts and hike prices. They make use of the Internet to contract online at high prices and then stealthily cancel it. Most of the fake prices are higher than the average of the home sold in reality. Therefore, the online price releases can be deceptive and the cancelled contracts are generating price bubbles.

That's why people don't feel the same as our figures can reflect.

The third point:  generally speaking, we think the real estate market will achieve satisfactory development in 2005 with the housing price growth further slowing down.  The government has published some control goals, with which the property industry will make very good development.

2.Phoenix TV:  Mr. Cai Xuchu, in your report you mentioned that land supply is comparatively short.  What does that mean?  To solve the problem, where will Shanghai generate land resources?  Will claiming land from the sea, as the project in Nanhui District, provide a solution? 
My second question is for Miss Jiao Yang.  According to a media report,  US-based Disney plans to build a theme park in Shanghai.  Is that report true?  If true, where is the location? 
The tsunami-hit India Ocean area is progressing into the reconstruction stage, will Shanghai participate its reconstruction?

Cai Xuchu:  The first question is about Shanghai's shortness of land supplies.  Applying the strategy of "taking good care of land supply and managing credit administration well" is a faithful implementation of the nation's macro control policy.  It is short of land resources, while the property developers demand land to build houses. Because of the limited supply currently in downtown areas, it's very likely to expand the use of land out to the suburban areas.  On the other hand, Shanghai must ensure a certain volume of land for farming, which has further tightened  land supply.  As to the project in Nanhui District of claiming land from the sea, I'm not clear  on that and can't give you an answer.

Jiao Yang: According to regulations, all large theme parks must get approvals from the State Council.  But we haven't yet received information, in this regard, so far.
Since the strong quake and the following tsunami hit the India Ocean area around the end of last year, Shanghai's leaders in party and army have allocated high attention.  In accordance with the central government's unified deployments and work requirements, Shanghai has arranged for wide donations amongst the public and provided aid to the disaster-ridden countries and peoples.  As required, Shanghai has dispatched China's first medical group, which has successfully completed the work during that period.  Meanwhile, all other hospitals have prepared well, ready for directions from the country's related departments.  Now the entire tsunami-hit area has entered reconstruction stage, toward which the Chinese government has voiced clear and active attitude.  Shanghai, also giving close attention to the progress, is ready at any time to contribute the people's capabilities and sincerity under the nation's unified arrangements, once there's the need from the disaster areas and if the city's capabilities allow.

3. Shanghai Morning Post: Today, there's a media report that people who are not relocated population may be allowed to buy the government-sponsored low-price housing.  Is this true?  If true, is there any concrete timeframe or detailed regulations? 
Will Shanghai no longer use the word GDP in its local government's statistic gazettes?  Instead, will it make a trial use of "green GDP", a notion that is very popular now?

Jiao Yang: Shanghai Mayor Han Zheng indicated in his government work report that in order to ensure the health and stability of the property market, the Government will step up its regulation and control efforts, with a view to ensuring that the majority of new properties developed are non-luxury residential units to be owner-occupied by Shanghai residents.
The municipality would encourage the development of affordable housing; not only to meet the demands of the relocated residents, but those of low-income families as well.
A revision on the existing discount housing policy, to benefit even more local residents, is currently under discussion.

Cai Xuchu: Let me answer your second question.  A regulation issued by the central government, at the end of last year, renamed the word GDP in its local government's statistic gazettes.  The GDP of Shanghai is now called Shanghai's GDP.  Now, the nation begins to pay more attention to the "green GDP", a grand system but also a worldwide difficulty.  As far as we know,  no international country has ever formally counted the datum adhering to the standards of the green GDP.  Some countries, including ours, are doing research on this issue.  But our nation focuses more on the current research of the counting framework, as we are still beginners in this new aspect. Nonetheless, local experts do some work on the counting of the green GDP as well.  Compared to the national experts, the local's do more on the training costs of the water, air and solid waste pollutions and the expending costs of the land resources.   However, I haven't received any notice from the authority that the city would be an experimental unit for this green GDP.

4. Asahi Shimbun, Japan: My first question is to confirm one piece of news, published on the website of one authoritative newspaper, claiming that the construction of the maglev line between Hangzhou and Shanghai would start this year and be finished in 2009.  Is that true?  Secondly, what was the local GDP per capita in 2004 and what was the increase rate, from that of 2003?

Jiao Yang: I haven't been informed of the issue you mentioned in your first question. Mr. Cai Xuchu will answer your second question.

Cai Xuchu: We haven't got the exact data of the local's GDP per capita.  This figure used to depend on the number of the registered population.  However, since last year, the State Statistic Bureau requested weestimate the regional GDP per capita by the number of the permanent population.  So, this change makes the statistic work a little complex.  However, we will publish this figure as soon as the definite data comes out.

5. STV(Shanghai TV Station) News Channel: The city has adopted three relevant municipal regulations on the basis of China's Administrative License Law. Must we obey all  three regulations in practice? Secondly, how do the regulations maintain the balance of interests where the personal interests of local residents are concerned? How do we measure the cost of law enforcement?

Liu Ping: All the regulations must be obeyed in the application process of license approval. As to how to balance interests and whether the cost of law enforcement is heavy, it is impossible to be accurate about these things in the regulations. These things will be fixed in the given situation.

6. China Business News: According to the government report, Shanghai has made nine-year of compulsory education accessible to 99.99 percent of local school-age children. Does the statistics include children of migrant workers? Secondly, I find a flaw in the city's regulations on the issuing of administrative permits. Under the 22nd clause of the regulations, people whose applications are refused for hiding facts are forbidden to apply again for one year. However, according to China's Administrative License Law, the punishment may only be imposed on those who apply for licenses concerning public security, personal health or safety of life and property. Does the local regulation collide with the lex superior? Third, a Hangzhou-based newspaper has recently reported on the maglev project between Shanghai and Hangzhou. Could you confirm the report?

Jiao Yang: I have just said that we haven't had any news of the Shanghai-Hangzhou maglev rail line yet.

Liu Ping: Many thanks for reading the regulations so carefully. The question you raised doesn't expose the flaw in the regulations. We used a lawmaking technique here by writing "according to law" in the 22nd clause instead of repeating the full text of the relevant clause in the state law. In fact, the municipal regulation is consistent with the state law. 
 
Cai Xuchu: As to your first question, the statistics takes all the children who get local permanent resident cards into account and excludes those outside the city's education system.

7. National Business News: The total energy consumption per 10,000 RMB yuan of GDP is used as an index to indicate local energy consumption this year. What is the city's 2005 goal in this field?  

Cai Xuchu: This index is mentioned in the work report of the municipal government. Statistics show that the energy consumption per 10,000 RMB yuan of GDP was 1.07 tons of standard coal in 2003 and 1.02 tons in 2004. It is expected to be reduced to below 1.02 tons of standard coal this year.