China’s rural homestead system have both the function of housing security and property. However,with the rapid development and transformation of China’s economy,the functional positioning of homesteads is transforming from “seeking property function in the orientation of housing security” to “maintaining housing security in the orientation of property function”. In order to adapt to this transformation,we propose a basic system structure of “collective ownership,empowerment and revitalization,and housing ensuring”,and point out the focus of the reform are:first,strengthen the usufructuary right of homestead and clarify the mortgage and transfer of homestead use right,so as to provide a legalized system basis for empowering and revitalizing homestead; second,the acquisition of homestead need to be changed from “free acquisition” to “paid acquisition”,and the holding period should be changed from “long-term” to “70 years”，which is not only an effective way to solve the problems of homestead over-occupied,but also provides an alternative path for the homestead mortgage and transfer; third,solve the housing security problem of farmers via various forms,and gradually shift the homestead security based on identity right to the housing security based on citizenship right.