The Space for Space-Making
Shenzhen, the special economic zone established in 1980, was the first Chinese city to introduce housing as a commodity, in contrast to the established communist planning economy. Housing in the special zone could be owned or bought and sold on the market, instead of only being distributed by the state to privileged residents. Shenzhen’s development was taking its cue from capitalist Hong Kong, directly across the Sino-Hong Kong border. Hong Kong, however, has now become one of the least affordable cities in the world. If Shenzhen is learning from Hong Kong, what its future will be?
The relatively lower housing prices in contemporary Shenzhen as compared to Hong Kong reflect the contributions of two kinds of architects. The first group are professionals who build for governments or developers. Because their plans must comply with myriad legal and commercial requirements, their creativity is regulated before it begins. The second group are amateurs with other identities: farmers or migrant workers who own a piece of land on which they build according to the allowances of their rural hukou. Hukou (户口) is a system of household registration used in mainland China. It officially identifies a person as a permanent resident of a given area, and governs the allocation of many social resources. For instance, a farmer household with rural hukou would be allocated 100 square meters of land to build housing with a maximum ground-floor area of 80 square meters, comprising up to three floors — regardless of the fact that, due to the expansion of the city, the land categorized under the rural hukou is now surrounded by formal urban development. Citizens with urban hukou, in contrast, once received housing assignments under the planned economy. Nowadays, they can only buy houses or apartments on the market.
Farmer architects with rural hukou thus have far more freedom to build, even within the city, than citizens with urban hukou do. They can act as investors, owners, laborers, designers, and end-users of their buildings. Compared to professional architects, farmer architects are like adventurers with a punk spirit, constantly breaking norms of Chinese urban planning. Consider, for example, the urban villages densely built with what is nicknamed “kissing architecture” — houses so close together that two people could kiss simply by leaning out the windows. To plant a house rather than a crop is a rational economic decision, and the increasing density of kissing architecture reflects a strategy of expanding vertically to meet demand in the rental market, while also abiding by the limit set on floor area. Self-built housing has long been the main supply in rural China, as it was in Hong Kong before the Opium War in 1840. Much of this kind of architecture still exists in other parts of the New Territory. In Shenzhen, approximately 50 percent of the urban population lives in urban-village housing built by farmers.
In Hong Kong, it is the opposite: As of 2019, about 45 percent of the population was living in permanent government-run public housing. As Alan Smart has argued, the origin of Hong Kong’s public housing in the 1950s was neither a concern for welfare nor an indirect strategy to facilitate development, but an aim to improve the legitimacy of British governance; the imperial power, working against the backdrop of the Cold War, sought to resettle refugees from the mainland who were living in self-built shelters.1Alan Smart, The Shek Kip Mei Myth Squatters, Fires and Colonial Rule in Hong Kong, 1950-1963 (Hong Kong: Hong Kong University Press, 2005). The establishment of public housing in Hong Kong was an alternative path toward meeting this residential demand, rather than the result of service to an increasing population. But despite the rubric of “public” housing, the system has been in place so long that the gap between “haves” and “have-nots” is only becoming worse. Any reform that causes a downturn in housing prices will provoke further social unrest if the middle class — the “haves” — end up as losers. For frustrated youths who see a future defined either by unaffordable market-rate housing or public housing in severely short supply, street protest becomes a last resort.
Housing should not be “public.” It is a private good, a product that must be paid for in order to be consumed — that is, inhabited — and habitation by one individual prevents another individual from “consuming” the same space at the same time. Housing is not a special commodity exempt from the law of demand: When the price increases, the market will add supply, especially when consumers become suppliers. But, in Hong Kong, when the price of housing increases, supply does not respond, because of the government’s land monopoly and other restraints. Besides, when the public or the state is forced to absorb a shortage in a private good, people still compete through means other than money. For instance, when mainland China was under the centrally planned economy, permanent urban residents used their urban hukou, rather than price, to access housing distributed by the state; when housing is distributed as a form of welfare, only those eligible can win in the competition. In Hong Kong today, people who apply for public housing compete by being able to spend a longer time on a waitlist. The average waiting time for public housing in 2021 is 5.5 years, and will grow to six years before 2022.2Holmes Chan, “By 2022, Average Hongkonger Could Wait 6 Years or More for Public Housing, Think Tank Warns,” Hong Kong Free Press (April 18, 2019). Therefore, treating housing as a public good may shoot the messenger — that is, price — which reflects the relation of supply and demand, but can’t prevent shortages if the land market is controlled by the government. This is the case in both Hong Kong and Shenzhen.
Local farmers who live permanently in Shenzhen have the flexibility to respond as suppliers to the housing market. However, Shenzhen doesn’t have a free housing market, either. For instance, in 1992, within the Shenzhen boundary known as the “second line,” all farmers’ rural hukou were changed to urban hukou.3The “second line” in Shenzhen was a northern boundary set in 1982, comparable to the Sino-Hong Kong border in the south, to limit the territory of the special economic zone. It was formally withdrawn in 2018 to facilitate the increasing urbanization of Shenzhen. This allowed them better access to urban welfare systems. But they lost their land rights, especially their access to land for self-built housing. Besides, unlike housing provided by real-estate developers, farmer housing cannot be sold on the market.
Villagers can, however, collectively negotiate with developers who seek to demolish urban villages in order to make way for new development. These projects are different from those in which developers are supposed to be selected through open bidding — where, in reality, the winner is always assigned by the government. The high compensation in such deals distorts farmers’ will to maintain community in their urban villages, if they expect that a demolition may happen in the near future. What’s more, as more urban villages are demolished, Shenzhen is losing urban density and efficiency. This, in turn, distorts the division of labor of the whole city and drags down economic performance.
In this sense, the space for space-making encompasses more than simply the right to build. Such “space” also includes the rules that enable people to deal with their property in a large and efficient market. If Shenzhen keeps learning from Hong Kong to build public housing while constraining the space for space-making of this kind, then we can expect that the shortages and high prices characteristic of Hong Kong housing today will be the future of housing in Shenzhen. Another possible future, however, would be to imagine a governance that allocates space in which people can cooperate in building and maintenance, allowing more wealth to be distributed in society at large rather than concentrated in the real-estate industry.
We have a responsibility to understand why the space for space-making matters.
- Alan Smart, The Shek Kip Mei Myth Squatters, Fires and Colonial Rule in Hong Kong, 1950-1963 (Hong Kong: Hong Kong University Press, 2005).
- Holmes Chan, “By 2022, Average Hongkonger Could Wait 6 Years or More for Public Housing, Think Tank Warns,” Hong Kong Free Press (April 18, 2019).
- The “second line” in Shenzhen was a northern boundary set in 1982, comparable to the Sino-Hong Kong border in the south, to limit the territory of the special economic zone. It was formally withdrawn in 2018 to facilitate the increasing urbanization of Shenzhen.