The Impact of Housing Market Policy on House Prices in China

Mei Liu, Qing Ping Ma

Research output: Chapter in Book/Conference proceedingConference contributionpeer-review

Abstract

The phenomenal growth of the housing industry in China has been accompanied by the rapid rise in house prices in the past two decades. Governments at different levels have issued various housing policies to moderate the house price increase and prevent bubbles in the housing market. This study investigates whether and how housing market policies influence house prices as policymakers intend, using monthly time-series data of house prices, policy variables, and control variables between 2004 and 2022. The policy variables include monetary, land, tax, and down payment-related policies. The regression analysis shows that suppressive housing market policies have a significant negative impact on house prices; suppressive monetary, land, and tax-related policies also individually have a significant negative impact on house prices. There are several delays between the implementation of a housing market policy and the appearance of a significant impact. The time trend represents the expectation of continuing house price increases in the past two decades and appears to be the most crucial driver. The present findings indicate that housing market policy tools have significant impacts on house prices and can be effectively used to prevent bubbles in the housing market in China.

Original languageEnglish
Title of host publicationApplied Economic Research and Trends - 2023 International Conference on Applied Economics, ICOAE 2023
EditorsNicholas Tsounis, Aspasia Vlachvei
PublisherSpringer Nature
Pages793-814
Number of pages22
ISBN (Print)9783031491047
DOIs
Publication statusPublished - 2024
EventInternational Conference on Applied Economics, ICOAE 2023 - Brno, Czech Republic
Duration: 29 Jun 20231 Jul 2023

Publication series

NameSpringer Proceedings in Business and Economics
ISSN (Print)2198-7246
ISSN (Electronic)2198-7254

Conference

ConferenceInternational Conference on Applied Economics, ICOAE 2023
Country/TerritoryCzech Republic
CityBrno
Period29/06/231/07/23

Keywords

  • Down payment
  • House price
  • Land price
  • Monetary policy
  • Tax policy
  • Time trend

ASJC Scopus subject areas

  • General Business,Management and Accounting
  • General Economics,Econometrics and Finance

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