Chinese Apartment Buildings Photo: iStockPhoto

A pilot scheme that will allow villagers in 13 Chinese cities to build rental housing on public sites was launched by the Ministry of Land and Resources and the Ministry of Housing and Urban-Rural Development on Monday.

The first batch of cities for the scheme includes Beijing, Shanghai, Shenyang, Nanjing, Hangzhou, Hefei, Xiamen, Zhengzhou, Wuhan, Foshan, Zhaoqing and Chengdu.

The scheme is aimed at increasing the supply of public rental units to help stabilize housing prices and achieve healthy growth in the market, the ministries said.

Prior to the announcement, pilot projects have been launched in major cities such as Beijing and Shanghai previously, the 21st Century Business Herald reported. Under the new rules, villagers have the right to build houses on their non-agricultural public sites and lease them out.

The new rules are expected to increase the housing supply in the cities, which are mainly first- and second-tier cities with limited land resources, Zhang Dawei, an analyst at Centaline Property Agency, was quoted as saying in a report on Yicai.com. Zhang said villagers can enjoy a 5% yield through these rental houses.