Increase in the number of households in China

Increase in the number of households in China

Description:

Despite a fall in population growth rate, the number of Chinese is projected to reach almost 1.5 billion by 2030. The projected drop in household size to 2.2 people by the year 2030 alone will add over 250 million new households — more than the total in the entire Western Hemisphere in 2000 — even if China’s population size remained constant. The number of China’s households grew almost three times as fast as its population during 1985–2000, because average household size decreased from 4.5 to 3.5 people. This alone gave China an extra 80 million households in 2000.

This increase in the number of households has severe implications for China's energy consumption and its subsequent affect on the environment.

Enablers:

1. Increase in divorce rates: Divorces have increased sharply owing to simplified divorce procedures and wider societal acceptance of divorce. In 2004, more than 1.6 million couples filed for divorce, up 21% from 2003. Divorces hurt the environment because they double the number of households and reduce the household size, increasing per capita resource consumption and waste.
2. Change in social norms: There has been a decline in the number of households where several generations live under one roof. Many older people now live alone, rather than with their children and grandchildren.
3. Increased affluence: As the Chinese become a more affluent nation, people no longer need to share their house with others (i.e., family members) in order to be able to afford the rent/mortgage.
4. Increased urbanization: China has been experiencing increasing urbanization over the last fifty years. From 1952 to 2003, while its total population ‘merely’ doubled, its proportionate urban population tripled from 13% to 39%. People move out on their own as more housing becomes available and affordable in cities.
5. Government support for home ownership: The Chinese government has offered sweeteners ranging from tax breaks to easier credit access to widen home ownership. One major preferential policy effective from November 1, 2008 saw the property deed tax decline to 1% from 1.5% for people buying their first homes if they are smaller than 90 square meters. Also, for those buying their first homes, the down payment requirement will be lowered to 20% from 30%, and banks will be allowed to charge as little as 70% of the benchmark lending rates for such mortgages. It also removed the 0.05% stamp tax and land value-added tax for home purchases. Real estate investment is the second-largest contributor to the country's urban fixed-asset investment, which is a major driver of the overall economy.

Inhibitors:

1. Declining economic growth rate: If China's economic growth slows, then the growth of affluence will also slow, preventing people from being able to afford separate housing.
2. Decrease in building material availability: Urbanization will decrease and new construction will decrease if there is a shortage in building materials.
3. Change in societal norms: The number of households will also decrease if new generations decide to live with their families and take care of older generations.
4. Increase in housing taxes: If the Chinese government starts to increase housing taxes then less people will be able to afford housing.
5. Government restrictions: The Chinese government may decide to implement government restrictions on the construction on new housing in order to prevent further harm to the environment.

Experts:

• Zhongwei Zhao - Researcher in demography and mortality in East Asia

Paradigms:

Because smaller households consume more resources per person, China’s rapid increase in household number and reduction in household size have had significant environmental consequences.

• Biodiversity: Household dynamics influence per capita consumption and thus biodiversity through, for example, consumption of wood for fuel, habitat alteration for home building and associated activities and greenhouse gas emissions. Growth in household numbers globally, and particularly in countries with biodiversity hotspots (areas rich in endemic species and threatened by human activities), was more rapid than aggregate population growth between 1985 and 2000. Even when population size declined, the number of households increased substantially. Reduction in average household size alone will add a projected 233 million additional households to hotspot countries during the period 2000–15. Rapid increase in household numbers, often manifested as urban sprawl, and resultant higher per capita resource consumption in smaller households pose serious challenges to biodiversity conservation. (Liu, Daily, Ehrlich, & Luck 2003)

Timing:

• A drastic increase in the number of households and a sharp reduction in the mean size of households were recorded after the land reform in the early 1950s. (Zhongwei & Wei, 2008)
• Affordable housing programmes were introduced on the mainland in 1998 and modelled on public schemes in Hong Kong.
• By 2030, reduction in household size alone will create 250 million new households, more than the total number of households in all the countries of the Western Hemisphere in 2000. (PBS, 2006)
• The urban population is expected to grow by 20 million every year, accompanied by construction of 2 billion square meters of buildings every year through 2020.

Web Resources:

1. Liu, Daily, Ehrlich, Luck. (2003). Effects of household dynamics on resource consumption and biodiversity.
2. Li, R.. (2008). South China Morning Post. Xiamen unveils scheme to boost affordable housing programme.
3. PBS. (2006). China's Environmental Future.
4. Liu, Jianguo. 2005. China's Place in the World: Environmental Impact of a Giant
5. Zhongwei & Wei. 2008. Changes in household formation and composition in China since the mid-twentieth century.