The above problems, though limited to certain localities and created by structural imbalance, have huge impact on society due to the following reasons. First, mismatch between supply and demand is acute. From the demand side, there is a continuously strong demand as a result of higher income and faster urbanization.
From the supply side, the insufficient aggregate demand is coupled with imbalanced mix of housing available and shortage of supply of small-and-medium-sized apartments. From January to October 2007, floor space completed stood at 232 million square meters, up 8.8% y-o-y.