House Price Dynamics: Evidence from Beijing

Jinhai Yan (), Lei Feng () and Helen X. H. Bao ()
Additional contact information
Jinhai Yan: School of Public Affairs, Xiamen University, Xiamen 361005, China
Lei Feng: Department of Land and Real Estate Management, School of Public Administration, Renmin University of China, Beijing 100872, China
Helen X. H. Bao: Department of Land Economy, University of Cambridge, Cambridge CB39EP, UK

Frontiers of Economics in China-Selected Publications from Chinese Universities, 2010, vol. 5, issue 1, 52-68

Abstract: To study the house price dynamics in China, this paper extends the traditional life-cycle model by incorporating land supply, regime shifts and government regulation factors. The models are estimated with an error correction framework using quarterly data from 2000 to 2007 in Beijing. The conclusions are as follows. (1) There exits a stable co-integration relationship between house price and fundamentals; land supply and financial regimes are also important determinants of long-run equilibrium house prices. (2) Short-run dynamics depend on changes of fundamentals and the adjustment process of housing market. Land supply has a significant impact on house price fluctuations while demand factors such as user costs, income and residential mortgage loan have greater influences. The adjustment speed of real house prices to the long-run equilibrium has been reduced significantly since 2005 which means exogenous shocks can cause prolonged deviation of real house prices from the equilibrium level.

Keywords: house prices; house price dynamics; regime shifts; macro-regulation (search for similar items in EconPapers)
JEL-codes: R21 R31 R38 (search for similar items in EconPapers)
Date: 2010
References: Add references at CitEc
Citations: View citations in EconPapers (4)

Downloads: (external link)
http://journal.hep.com.cn/fec/EN/10.1007/s11459-010-0003-6 (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:fec:journl:v:5:y:2010:i:1:p:52-68

Access Statistics for this article

Frontiers of Economics in China-Selected Publications from Chinese Universities is currently edited by LONG Jie

More articles in Frontiers of Economics in China-Selected Publications from Chinese Universities from Higher Education Press
Bibliographic data for series maintained by Frank H. Liu ().