Central planners have long shaped Hegang, a city located in the far northeast of China. In another time, coal and other minerals made it a pillar of socialist industry. When the richest veins were declared exhausted, just over a decade ago, the central government closed many mines and opted for green infrastructure. The shanty towns where soot-smeared miners had lived were torn down and replaced with brightly painted apartment blocks, stretched toward the horizon alongside new urban parks.
A high-speed train line was inaugurated in December. There is talk with pride of a graphite mine that will supply battery factories for new energy vehicles. Unfortunately for the technocrats, they could not prevent more than one in six inhabitants from leaving the place since 2010, fleeing low wages, poor job prospects (especially for graduates) and long, dark and brutal winters. .
More recently, the combination of a boost in housing construction and population decline has given Hegang an unexpected distinction. It is, by some measures, the cheapest city in China at the prefectural level or above. In 2019, Hegang became famous online after some newly settled youth in the city recorded viral videos and posted blog posts bragging about buying spacious apartments for as little as 46,000 yuan (6,200 euros). The claim is supported by more formal studies. Hegang's second-hand homes sell for an average of 2,152 yuan per square meter, making them 40 times cheaper than in Shenzhen, a southern high-tech metropolis.
That backwater of 790,000 people located along the Russian border has today become on the Internet a place where those who struggle to get ahead (and the dispossessed and misfits) can turn their modest savings into a home. It is true that many give up and leave the city after a few months, often when winter temperatures drop as low as -20°C. Others only visit briefly to decorate apartments bought online, before returning to live as migrant workers in a factory residence in some gigantic city in the east of the country.
Yet even that remote form of ownership is "a form of emotional comfort" for migrants, who can spend years in Shanghai or Guangzhou with no hope of buying a home there, says Liang Yunpeng, a real estate agent for Hegang. Liang sells about 80 cheap flats to foreigners a year; usually on the upper floors of old buildings without elevators. His clients usually have less than 30,000 yuan to invest.
It would be risky to predict Hegang's resurgence thanks to newcomers. A few successful new residents supplement local jobs by creating short videos and texts extolling the novelty of their move to China's far northeast and garnering millions of views for their films about the cold or cheap eating out. Only a small number can become famous online for living in Hegang.
Still, that small town is a good place to watch a broader trend. China is facing a cost of living crisis. Between 1998 and 2021, Chinese urban housing became four times less affordable, as judged by the ratio of median home prices to median available rents. A 100-square-meter flat today costs on average about 6.3 million yuan in Beijing, that is, about 900,000 euros. That equates to 34 times the median annual wage in the Chinese capital. The fact that housing is unaffordable is a particularly painful circumstance because property is seen as a safe form of government-backed savings, and because a man without a flat of his own often has a hard time finding a wife. It also exposes the deep inequalities of modern society. Some have to do with huge income inequality. However, others are the reflection of entrenched privileges from the socialist era; especially after urban housing was privatized in the 1990s and sold at deep discounts to state workers and civil servants.
Visiting Hegang, we meet the owner of a small hamburger joint, the last name of Hou. He is a native of the area and returned from Beijing in 2020, when the covid-19 pandemic interrupted his work as a guide dedicated to taking Chinese tourists to Russia. Such a vacation is not cheap: a family trip to Moscow can cost 30,000 yuan. Despite this, it seems that many of his clients were ordinary retirees. The explanation is that those who have lived in Beijing for a long time may own two or three apartments, bought at a low price years ago. At present, even a small apartment can generate an annual rent of 60,000 yuan. Hou has observed that more and more of Hegang's friends are returning home after realizing that, like foreign migrants in a big city, they will never have enough capital to buy a home or start a business. Hou is also glad to hear more and more customers or delivery people speaking with a non-local accent. For starters, these newcomers drive up home prices.
Some locals are annoyed by Chinese bloggers who call the city a paradise for those who yearn to “lay back” doing nothing or abandoning material ambitions. Wang Dakai, who spent ten years in big cities before returning and opening a barbershop, worries that Hegang will be branded lazy. “None of us get 'down,' we all work a lot,” he says. In demonstration of his point of view, in exchange for answering the questions, he asks to record a video simulating cutting the British visitor's hair to post it on his social networks.
Some new beginnings manage to change lives. The purchase and renovation of a flat for 70,000 yuan last summer enabled a 25-year-old vlogger who goes by the name Hua Hua to create a home for herself and her 10-year-old sister. Every month she sends money to pay for the care of her mother, who is mentally disabled and lives in her home in Jiangxi province, some 3,000 kilometers to the south. She supports herself by selling pancakes and bean jelly from a street cart, babysitting cats, working as an online customer service assistant, and writing. Hegang is quiet and welcoming, she says, and has some good schools from its days as a mining center.
Besides, she likes the snow. Not long ago she was joined in her tiny cat-filled apartment of hers by a friend, mother, and divorcee. The friend has realized that many newcomers have difficult relationships with her families, just like her.
No central planner set out to make Hegang a city where young women could enjoy a rare autonomy, with no husband or relatives to exercise control over them. That cheap old mining town is best understood as an accidental release valve. Its surprising fame shows that Chinese society is a system under terrible pressure.
