The backward legislation ideas and fuzzy right framework of Chinese current rural residential site institution can not realize gain right because of the residential right restriction, which causes its serious waste and low exploitation efficiency. The Third Plenary Session of the Eighteenth Central Committee of CPC proposed a strategic concept of “reforming and improving the system of rural residential sites”. Therefore, the institutional innovation of rural residential sites should embody urban-rural fairness, regional fairness and practical fairness and attain the goal of intensive land-use. However, current two reform ideas such as “limiting free transfer and enlarging exploitation rights” and “free transfer” have natural shortcomings because the two ideas only concern about the surface of the sites and do not reconstruct the residential site institution under the background of overall urban and rural development and new-style urbanization. “The Residential Site Normalization” Model is helpful to intensively use the land, can embody social fairness on larger scale and is relatively a more ideal scheme to solve China’s residential site problem by taking the right to replace the materials, by introducing market-oriented transaction mechanism and by transferring the residential sites indexes in national range.