Shanghai's affordable apartments are no doubt attractive for poorer families.

　　But the ceiling price of 3,500 yuan (US$422) a square meter may still be beyond them.

　　The city's average disposable income was 14,867 yuan per capita last year, one of the highest in the country but not high enough to keep up with Shanghai's rocketing housing prices.

　　At the end of 2003, the city's average housing price hit 5,118 yuan a square meter, or more than double the nation's average of 2,212 yuan, according to the National Bureau of Statistics.

　　In Shanghai, it may cost a family with average income 20 years' savings to buy a 100-square-meter apartment. The situation is worse for poor families.

　　The municipal government has decided to sell 3 million square meters of affordable apartments for middle and low-income families this year. Another 3.5 million square meters of low-range flats will start construction.

　　The government hopes all those apartments will be sold to people relocated for the city's large infrastructure projects.

　　The Shanghai Housing and Land Administrative Bureau says the prices for these apartments will be capped under 3,500 yuan a square meter, much lower than the average.

　　In the first two months of this year, about 8,000 flats of 610,000 square meters were sold. In 2003, 14,000 apartments were offered to local residents moved for construction of train lines, green space and the Middle Ring Road.

　　But the affordable apartments do not benefit all the needy.

　　Although some of the affordable apartments are compact, ranging from 50 to 90 square meters, poor families may not afford the unit price of at least 180,000 yuan.

　　To make matters worse, only 15 percent of the affordable apartments on the market each year have an area as small as 50 square meters. The bigger apartments can have unit prices of up to 320,000 yuan.

　　The price factor aside, the affordable housing plan suffers from lack of enough space for the target buyers.

　　The annual construction of about 3 million square meters of affordable housing is insufficient to solve the housing crunch.

　　According to the Shanghai Housing and Land Administrative Bureau, about 100,000 families are relocated every year, creating an annual housing demand of 7 million to 8 million square meters.

　　Of these families, about 30 percent are rated as extremely poor, or burdened with handicapped members or laid-off workers.

　　Some of the families even live off government subsidies of 290 yuan a month.

　　In parallel to the affordable housing plan stands a favorable tax policy for purchasers of cheap apartments.

　　Effective from last December 1, the tax rebate policy covers middle and low-income families who buy a home priced under 250,000 yuan, or a home smaller than 90 square meters and priced below 3,500 yuan a square meter.

　　The tax policy extends to purchases from June 1, 2003 to May 31, 2008.

　　Drafted by the Shanghai Housing and Land Administrative Bureau and Shanghai Finance and Taxation Bureau, the tax policy clearly excludes the rich.

　　In 2003, middle and low-income families were defined as those with an annual income of 13,250 yuan per capita.