The Impact of Exogenous Demand Shock on the Housing Market: Evidence from the Home Purchase Restriction Policy in the People's Republic of China
Cao, Xiaping; Huang, Bihong; Lai, Rose Neng | March 2018
Abstract
In order to deal with the rampant increase in housing prices, the Government of the People’s Republic of China implemented the home purchase restriction (HPR) policy to curb speculation and prevent housing bubbles. This policy triggered an exogenous demand shock to the housing market. Employing a two-step difference-in-differences approach, we find significantly negative policy effects on property transaction volume but a small impact on housing prices. Cities relying heavily on land sales for fiscal revenue experience a considerably higher increase in property investments after implementation of the HPR policy.
Citation
Cao, Xiaping; Huang, Bihong; Lai, Rose Neng. 2018. The Impact of Exogenous Demand Shock on the Housing Market: Evidence from the Home Purchase Restriction Policy in the People's Republic of China. © Asian Development Bank Institute. http://hdl.handle.net/11540/8108.Keywords
Rural planning
Economic development
Economic indicators
Standard of living
Development projects
Development policy
Housing projects
Development models
Social reform
Urban planning
Public Borrowing
Credit Policy
Banks
Cultural Development
Development Economics
Development Issues
Financial Sector Development
Infrastructure Development
Urban Development Finance
Financing
Financial System
Financial Sector Reform
Financial Institution
Bank Financing
Real estate development
Housing development
Community banks
Mortgage banks
Housing policy
Tax administration and procedure
Real property and taxation
Property tax
Credit control
Banks and banking
Title companies
Tax deductions
Accounts
Savings
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