Is HOA capitalized in housing price? Evidence from Chongqing, China

Feng Deng

International Journal of Housing Markets and Analysis, 2021, vol. 15, issue 1, 94-107

Abstract: Purpose - International research has found that Homeowners Association (HOA) is capitalized in housing price in the West. Is that result applicable in Chinese cities? In China there is also widespread applause for HOA. Will that leave trail in the housing market? This paper aims to answer these questions by presenting empirical evidence from 113 private gated communities in Chongqing, China. Design/methodology/approach - The data set comes from three different sources including a telephone survey. The research methodology includes hedonic models with an endogenous dummy variable of the presence of HOA in a community. Findings - HOA is not capitalized in housing price. Research limitations/implications - The empirical finding helps to explain why about 80% of private communities in big Chinese cities have not formed an HOA. Originality/value - This is the first empirical study on HOA capitalization in housing price in China.

Keywords: China; Capitalization; Housing price; Neighborhood governance; Homeowners association; Private community; D23; D71; R31 (search for similar items in EconPapers)
Date: 2021
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Persistent link: https://EconPapers.repec.org/RePEc:eme:ijhmap:ijhma-10-2020-0125

DOI: 10.1108/IJHMA-10-2020-0125

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