China will optimize underutilized land resources and leverage a wider range of financing channels to advance urban renewal projects in a region-specific manner, the State Council, the country's Cabinet, said on Friday.

China has placed great emphasis on urban renewal initiatives as a crucial lever for expanding domestic demand and improving the quality of life for households, according to the State Council executive meeting chaired by Premier Li Qiang.

Greater efforts will be directed toward accelerating the redevelopment of run-down urban areas, including old residential communities, industrial zones and urban villages.

The country will step up support for urban villages and dilapidated housing renovation projects, renovating an additional 1 million such housing units with measures such as providing monetary compensation to households, said Minister of Housing and Urban-Rural Development Ni Hong in mid-October.

In addition, the scope of the urban village and dilapidated housing renewal program was broadened in November, expanding from the initial focus on 35 major cities to now encompass 300.

If 1 million homes in urban villages and dilapidated housing are monetarily resettled at an average size of 100 square meters per unit, that could drive roughly 100 million sq m of residential property sales. This would account for about 10 percent of the total market volume, according to a study by the China Index Academy.

The influx of this new demand into the market is expected to significantly bolster trading activity and inject fresh vitality into the real estate sector, the academy said.

The government will work to enhance the coordination of fiscal and financial resources to bolster urban renewal projects, as well as foster market-based financing models to attract greater private capital participation, as outlined during the Friday meeting.

China has made boosting domestic demand a top priority for its economic work agenda this year in the face of persistent global headwinds, while effective investment has emerged as a key driver to shore up demand and facilitate stable growth.

Underground plumbing and wiring, an important part of urban renewal initiatives, is expected to require a total investment of around 4 trillion yuan ($546.6 billion) over the next five years, with an estimated 600,000 kilometers of aging gas, water and heating lines in need of upgrades, said the National Development and Reform Commission in late September.

The Chinese government will empower local authorities to spearhead innovative, locally tailored approaches to sustainable urban renewal, the meeting said.

Policy measures were also decided upon to ensure the timely and full payment of wages for migrant workers.

Steps will be taken to guide all levels of government as well as State-owned enterprises to prioritize the timely payment of wages and the clearance of unpaid wages, while also stepping up oversight and enforcement measures to compel private companies to fulfill their obligations.