Nail house

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A nail house (dingzihu or 钉子户) is a Chinese neologism for homes belonging to people (sometimes called "stubborn nails") who refuse to make room for development, often in an attempt to negotiate a high price in exchange for selling out. The term, a pun coined by developers, refers to nails that are stuck in wood, and cannot be pounded down with a hammer.^[1]^[2]

1 Historical background
2 Examples
3 Media coverage
4 Analogies in other countries
5 References
6 External links

[edit] Historical background

The famous nail house in Chongqing

During most of the Communist era, private ownership of real property was abolished. The central government officially owned all real estate, and could in theory dictate who was entitled to control any piece of property according to national interests. Private citizens, therefore, did not have a legal right to keep their property if the government decided they should leave (although in practice, entitlements arose for various reasons). With a strengthening economy and the rise of free markets beginning in the late 1990s, private developers began building shopping malls, hotels, and other private developments in densely populated urban centers, which required displacing residents who lived on the land. Developers would typically offer relatively low compensation to the residents, reflecting the pre-development value of their properties or the cost of obtaining alternate housing elsewhere. Should residents resist, or try to take advantage of their bargaining position, powerful developers could persuade local officials and courts to order residents off the land. In other cases, residents would be arrested on false charges or thugs would be hired to scare away the residents.^[1]^[3]

More recently, China has begun to accept private ownership of real estate, including the still-controversial notion that owners are free to earn money when their land becomes more valuable due to planned developments, or even to simply not sell. Discontent arose among the people over accusations of illegal land seizures by developers and corruption by complicit government officials.^[4]

In March, 2007, amidst widespread sentiment in favor of private ownership, China passed its first modern private property law.^[5]^[6] The law prohibits government taking of land, except when it is in the public interest. The law strengthened the position of nail house owners, but did not entirely resolve whether making room for private commercial developments was a public interest that entitled the taking of land.^[7]

[edit] Examples

A number of high-profile nail houses have received widespread attention in the Chinese press. In one famous case, one family among 280 others at the location of a six-story shopping mall under construction at the location of a former "snack street" in Chongqing refused for two years to vacate a home their family had inhabited for three generations.^[6] Developers cut their power and water, and excavated a 10-meter deep pit around their home. ^[1]^[8] The owners broke into the construction site, reoccupied it, and flew a Chinese flag on top. Yang Wu, a local martial arts champion, made a staircase to their house out of nunchakus, and threatened to beat any authorities who attempted to evict him.^[1] His wife, a restaurateur named Wu Ping who had planned to open a restaurant in the home's ground floor, granted interviews and frequent press releases to generate publicity.^[2] The owners turned down an offer of 3.5 million yuan (US$453,000), but eventually settled with the developers in 2007.^[6]

In another example, a "nail house" remained in Changsha, even after a shopping mall was built around it, and now sits in a courtyard of the mall. ^[9] One owner in Shenzen was paid between 10 and 20 million yuan (US $1.3 million to $2.7 million) for selling a seven-story building at the site of the future 439-meter (1,440 foot) Kingkey Finance Tower, that had cost him only 1 million yuan ($130,000) to build ten years before. The resident held out for months following an eviction order, and was subject to harassment and extortion attempts even after he reached a settlement.^[10] Two other nail house owners held out against the Kingkey development.^[11]

[edit] Media coverage

Nail houses have received an unusual degree of coverage in the Chinese Press. The Chongqing incident was initially called "coolest nail house in history" by a blogger,^[8] after which the incident was picked up by major media throughout China, including state-run newspapers, and became a national sensation.^[3] 85% of respondents to a poll on sina.com supported the couple rather than the developers.^[6] Later, however, the Chinese government forbade newspapers from reporting on the event.^[3]^[12]^[13] Another blogger, vegetable vendor Zhou Shuguang, traveled by train from his home in Hunan province to cover the incident, funded by donations from his readers. Writing under the pen name "zola", Zhou interviewed the participants, as well as crowds that had gathered and others who claimed to have been evicted from their homes. He was popularly referred to as China's first "citizen journalist" although his site was blocked as well.^[14] Others defied the prohibition as well, including the Chinese edition of Sports Illustrated, which worked a subtle reference of the incident into a magazine cover.^[15]

[edit] Analogies in other countries

State-run media have commented that the nail house phenomenon is not limited to China, mentioning that there have been similar hold-outs in the United States, the United Kingdom, Germany, and Japan. In particular they have cited families that refused to move even as the original and subsequent runway construction projects began around them for the Narita Airport outside of Tokyo, Japan.^[16]

In the United States, private property is protected by the Fifth Amendment to the Constitution from seizure by the government without "just compensation". Under the concept of eminent domain, local and national government agencies are entitled to take private property for purposes in the public interest, but must offer owners compensation amounting to the value of the property. The United Kingdom, New Zealand, and the Republic of Ireland have a comparable process called compulsory purchase, and there are equivalent laws in Australia and South Africa. In Kelo v. City of New London, the United States Supreme Court held that the government is entitled to take land from private parties to give to private developers. The decision was widely unpopular, and spurred various states to enact laws prohibiting the practice. However, the practice is common in other states. As in China, the efforts generally begin with an offer by the private group or government agency to purchase the land, and only become a question of eminent domain if the parties cannot negotiate a purchase price. When eminent domain seizures do occur there are often disputes over the value of the property, and whether it should fully compensate the landowner for the holdout value of the land.