Recently, it was reported by the media that residents of a 50-year-old dilapidated residential building in Huadu District, Guangzhou, raised 8 million yuan to rebuild a new elevator building on the original site. This incident can become news mainly because of two points: first, the reconstruction of dilapidated buildings on the original site is rare in China, and residents raise very little money by themselves; second, the whole thing took only half a year from the proposal to the construction. In such a short period of time, it is very difficult for the general community to collect all the property fees, and the construction of the original site can be so smooth?
Read the news carefully and discover that the truth is hidden in the details. This five-story dilapidated building, with only about 20 households, has long been identified as a Class D dangerous building (the most serious level of the "Dangerous Housing Appraisal Standards") due to its disrepair and cracked walls. Most of the residents have moved out, leaving only a few retirees. The estimated cost is about 300,000 yuan per household, and some elderly people cannot come up with the money and oppose the construction of buildings. The Huadu District Housing and Urban-Rural Development Bureau will go to the street to persuade you, promising that the government will subsidize the project as a whole with 500,000 yuan, a special subsidy (1,000 yuan per square meter) for households in difficulty, and contact the bank for low-interest loans to provide financial support.
With the blessing of these factors, the project progressed smoothly and started construction in only half a year. What if the old building is very large, and the building is in a slightly better condition, and there are many people? Without the active involvement of the government, persuasion and coordination, and financial subsidies (which are probably the decisive factors), the reconstruction of this old building would have been almost impossible.
Filling in the details, the whole picture of the matter emerges, and we see the familiar side: it is actually very difficult to rebuild the original site of a dilapidated building in China. Most of China's urban population has lived in apartment-style units for decades, and they have seen many dilapidated buildings, and they have hardly heard of residents raising their own funds to demolish and rebuild them. In fact, this is also the first project of its kind under the guidance of the government in Guangzhou, with an exploratory meaning.
Home Repair Fund, why is it so hard to use
Most of China's current urban buildings were built in the last 30 years, and the age of the buildings is relatively young, and they do not constitute dangerous buildings, but there are many cases that need to be reinforced, repaired or beautified. Most of the houses built before the 1980s in the central or old city of the city have entered the category of old and dangerous buildings, which need to be reinforced and rebuilt, and some even need safety appraisal.
But anyone with a little experience of living in urban communities knows that it is very difficult to use the Housing Maintenance Fund (i.e., the Public Maintenance Fund) to carry out the necessary repairs to the building, not to mention the major event of demolition and reconstruction.
According to the law, the residential maintenance fund belongs to the owners of the common ownership, the owners' general meeting manages, and the property company initiates the use of the property to fulfill the responsibility of property maintenance - in reality, the property company does not want to cause trouble, most of the residents apply, the owners' general meeting to make a vote, and the property company submits to the competent department. This process is very cumbersome, not only is the procedure cumbersome, but many practical obstacles are difficult to overcome.
Some communities are divided into commercial housing, resettlement housing and resettlement housing, and the charging standards are different, and some old communities have not even received them. If the owner's account balance is insufficient and he is unwilling to make up for it, it will involve the problem of cost allocation. More commonly, different owners have different levels of tolerance, and there are differences in the use of the maintenance fund, and if the fund is insufficient and needs to be paid, it is almost impossible to pass the discussion.
The "Tragedy of the Commons" of Community Commons
Properly repairing and beautifying an old and dilapidated home can help improve the quality of living, drive up house prices and rents, and in turn, increase the value of large properties – in any sense of the word, it is extremely beneficial to the owner. It would be a great thing if the dilapidated building was rebuilt on its original site.
But in real life, when the interests of many people are involved, the situation becomes complicated. Some people are reluctant to contribute funds in the face of practical difficulties, some people feel that they have not benefited enough for fear of suffering, and some people simply want to "free ride". The installation of an elevator in an old building often takes several years, and the neighbors are noisy and do not get along, not to mention such a big thing as repairing and building a building.
When urban residents in China buy a house, they receive a limited range of private property, which is basically limited to the house. Outside the house, from the corridor to the elevator, to the building wall, and the green space of the community, it is all common property. It seems that everyone has a share, but there are many constraints in exercising rights, and the cost of protecting interests is extremely high. The value of property in the common areas of the community accounts for a large proportion of the value of residential housing – to some extent, it plays a decisive role. It is precisely this part of the property value that is degraded and destroyed the fastest, and it is difficult for residents to remedy it. The "tragedy of the commons" in economics is vividly reflected in the matter of community common property.
American apartment complexes have the same problem
This is true not only in China's urban communities, but also in the United States. Most of the ownership of apartment houses in American cities belongs to a company, which entrusts the management of the property company to collect rent from the residents. With a single manager, the building safety and infrastructure (water, electricity, gas, etc.) of the apartment house are guaranteed. In terms of quietness and cleanliness, the situation of apartment housing is much worse - apartment rents are inherently low, tenants are uneven, management costs are particularly high, and the average property company is resigned to minor problems.
Similar to the property rights model of urban housing in China, the United States actually has it. In June 2021, a 12-story apartment building collapsed in Florida, USA, killing 97 people and leaving one missing. The building is more than 40 years old, but it is not an old dilapidated building in the traditional sense. With hundreds of units in the building filled with owners and a pool downstairs, it looks closer to an upscale apartment. The problem is that the building is jointly owned by the owners and entrusted to the property.
As early as a few years before the collapse of the building, some architectural designers, owners, and property management companies reported that the original design of the building was unreasonable, the walls were cracked, and the building was leaking, and the building needed to be reinforced and repaired. Repairs are costly, and owners keep refusing and see safety warnings as a trick of builders. A few days before the accident, the pool supplier also pointed out that the pool leak had left the garage full of water, and the situation was critical, but everyone was used to it. The collapse of the Florida apartment was not an accident, but a rush to destruction in the limelight, which is the greatest tragedy.
At present, there are more old and dangerous buildings in China, which are older and in more critical condition. In order to avoid tragedy to the greatest extent, in addition to paying attention to building safety, regular repair and inspection, it is also necessary to solve the problem of "difficult to repair and rebuild" in the mechanism. According to the Standards for the Appraisal of Dangerous Houses, rules need to be made as to what dwellings should be repaired, what voting procedures apply, how fees are charged and benefits are distributed. In this sense, the "original site reconstruction of dilapidated buildings" project in Huadu District, Guangzhou City has great exploratory significance.
According to the law, the maximum term of the right to use housing land in China is 70 years, and the automatic deadline of 70 years expires (the issue of fees has not been resolved). The design life of an urban dwelling is 50 years, which refers to the normal use of the design life period, usually without major repairs – the 50-year period expires, and if the building is of good quality and meets safety standards, there is no need for mandatory scrapping.
Solving the "difficulty in repairing and rebuilding" not only solves the current problem of dangerous buildings, but also facilitates the inheritance of property. When Chinese buy a house, they often collect several wallets and spend millions of yuan. Housing is the largest asset in most Chinese families and is generally passed down to two or three generations. The preservation of the value of these properties is of great importance and requires the concern of all.
On larger topics, new housing models need to be discussed – such as increasing the supply of land for construction and deregulating single-family and villas, so that ordinary Chinese can enjoy one home and one household like Americans. When each family takes responsibility for managing their own home, "difficulty in repairing houses" will not be a problem, and Hangzhou's recent relaxation of the ban on villas may be a good start.
• (This article is the author's personal opinion and does not represent the position of this newspaper)
Chen Xingjie
Editor-in-charge: Chen Bin