China has a large population of 1.2 billion.To solve the housing problem of middle_low income families and realize a condition,under which people can live in peace and work contentedly,a policy housing financial system(PHFS)with Chinese characteristics must be established.PHFS is a special financial area.The combination of financial relationships,forms and methods related to the purchase,construction or rehabilitation of housing for middle_low income families,is the core of policy housing financial system.It has real meaning for studying theory and practice of PHFS,its role in development of housing industry,and promoting economic growth of the country,civilization and progress of the society.