Demand outrunning supply has traditionally been cited as the reason for the high price of Beijing housing, but a recent survey provides a different perspective.

Rich people sitting on a stock of unused houses are keeping real estate prices up, according to the report by the Beijing Real Estate Association, an organization established in 1986.

Unused houses outnumber unsold houses in Beijing, said the survey.

The survey agreed with an earlier report by the Beijing Statistical Bureau that one tenth of Beijing's population have more than one apartment.

While some rich people may have many houses, many low-income people have none.

The report said that while around 10,000 economic houses were provided to low-income earners in 2006, Beijing has more than 130,000 families that qualify for this kind of housing.

So only one out of 13 families actually has an economic apartment.

Beijing has 14,000 cheap rental houses, but they can accommodate less than one percent of the city's population of 15 million, which is totally inadequate, said the report.

More than 70,000 families living on the lowest allowance of 310 yuan (about 40 US dollars) are queuing for an apartment, according to the report.

Residential real estate costs around 9,000-10,000 yuan (about 1150-1280 US dollars) per square km on average in Beijing whereas economic housing cost about 4,000 yuan (about 510 US dollars), said the report.

Real estate prices will increase by 11 to 14 percent in 2007, a slightly lower increase than in 2006, according to a market report released by Jones Lang LaSalle, an international property consultant and investor.

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