The construction industry's commitment to achieving carbon neutrality has underscored the urgency of promoting green and low-carbon sustainable affordable housing. However, the development process has encountered several challenges, including conflicts between the central and local governments arising from differences in value preferences, financial constraints faced by local governments, inadequate access mechanisms, lenient screening processes, insufficient funding, and remote locations. Despite its significance, the policies related to affordable housing, especially in the context of assembly affordable housing, have received limited systematic examination. To address this research gap, this paper presents a comprehensive review and analysis of China's affordable housing policies. Firstly, it compiles and compares recent affordable housing policies in China, serving as a valuable reference for future affordable housing construction endeavors. Secondly, it conducts an in-depth analysis of the barriers and challenges obstructing affordable housing development in China, and proposing corresponding measures for improvement. Moreover, this paper identifies significant opportunities for affordable housing development in the country and explores the potential synergy between the development of assembly buildings and affordable housing by leveraging their respective attributes. By illuminating pertinent policies and associated issues, this research aims to inform policymakers, practitioners, and stakeholders involved in the affordable housing sector. Additionally, it aims to stimulate further research and innovation in the field, contributing to effective and sustainable housing solutions for low-income communities and society at large. This paper systematically analyzes the current status of affordable housing policies, challenges and opportunities. It also discusses the application of assembly building techniques in the realm of affordable housing, proving valuable insights to address traditional housing issues.