The Housing System of China has experienced the process of welfare-oriented public housing distribution system, featured as widely-covering and low-level, to Housing Marketization. The Housing Marketization improved people's housing conditions quickly, however, it is accompanied by the expanding of housing gapas well as the withdrawing of government's housing security function.

From the year of 2007, government re-emphasized its responsibility of housing security, followed by the attempt to establish a new housing security system and to strengthen the housing security level.

There are series of problems for current housing security system:
(1)  As an organic union of housing system, land system and housing secruty system, this union is in shortage of top design and shortsighted.
(2) The current housing security system deteriorate the social justice, especially those affordable housing, sold non-publicly, has turned out to be the "legitimate channel" to transfer the state owned resource into private property for government and state owned departments.
(3) The government's responsibility of housing security is not clearly defined, and the current system does not cover those who need housing security mostly but covers those who are not most urgently longing for houses in terms of income and housing conditions, inevitably leading to the expanding rather than diminishing the housing gap.
(4) The contemporary housing security system distorts the land and property market and severely damages the efficiency of market.
(5) The implementation mechanism of current housing security system is imperfect, i.e. the mechanisms of fund-raising, financing, operating and monitoring are insufficient to demand.
(6) The external institutional environment is unfavorable for the housing supply and housing security: the distorted development mode and land administrative system increase the demand of security housing, and houses with limited property, actually play the role of housing security function, are considered  illegal.

The necessity and theory foundation of housing security: from a wide world view, most countries agree that the right of habitation belongs to basic human rights so that they provide housing to different degree. According to the principle of decreasing marginal utility, when redistributing in reasonable scope, the loss of utility of the rich is less than that gained of the poor, therefore the total social utility is increasing. Thus, it is justifiable to "robbing" the rich to help the poor, and contrarily, if not, the housing security is meaningless.

The principle of designing China's housing security system:
(1) Principle of justice―seizing the rich to help the poor, but not vice versa; diminishing rather than enlarging housing gap.
(2) Principle of efficiency―intervening the market as little as possible so that minimizing the waste of resources.  (3) Principle of basic security―supplying only necessary housing conditions, but not tempting the unqualified people to pursue the interest of security housing.