Abstract: The unclear land property rights making the land element cannot transact competitively by the market have been creating the serious problems in China’s national economy. The value of the lands in rural and the lands belong to the state-owned enterprises in urban are lower estimated and hidden. They cannot be traded on the market but have been allocated by the government at low prices even without compensation. Nevertheless, the prices of the lands which are allocated from the countryside to the cities are extremely surging. It is all because the local governments are acting as the dealers, who are the only buyer to expropriate the lands from the countryside but sold them to the thousands of the other buyers. The land factors are somehow limited to the above aspects, meanwhile the labor, capital, technology and other factors can be freely flowing, trading with each other, completive pricing, value expressing and market regulating in accordance with the rules of the market economy. It will lead to the chaos of the national economic operation: The lower general allocate efficiency of the factors, the siltation of the rural surplus labors, the paralyzed movements of the capital elements into the agriculture and the rural areas, the lost opportunities of the farmers using their lands to start a business and obtain the property incomes, are causing the inadequate of the demand of the affordable consumption of the rural residents and the non-registered residence in town. Furthermore, it is the reason causing the surplus productivities of the industrial goods in urban and the sluggish growth of the national economy. The policy implications of the paper are as follows: The truly clear and authorized the peasantry possessing the right of using property interest of the lands, and the sustainable rights to use them. All the types of rural lands can be traded equally in the unified urban and rural market. Famers have the right to construct their own lands.