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The Future Evolution of Housing Price-to-Income Ratio in 171 Chinese Cities

Author

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  • Xiaoguang Liu

    (National Academy of Development and Strategy, Renmin University of China)

  • Jian Yu

    (School of Economics, Central University of Finance and Economics)

  • Tsun Se Cheong

    (The Hang Seng University of Hong Kong)

  • Michal Wojewodzki

    (Department of Economics and Finance, School of Business, The Hang Seng University of Hong Kong)

Abstract

This paper examines the future dynamics of the relative housing price-to-income ratio (RHPIR) in China. We find that the convergence in RHPIR will be more congregated in the non-center cities of city clusters, the cities from the eastern region, with a net outflow of population, and low economic policy uncertainty (EPU). The convergence clubs will emerge in the cities with a net outflow of population and from the central and northeastern regions. The center and the non-center cities of city clusters will converge to parallel affordability paths. We pinpoint the cities with precise ranges of RHPIR that require special attention from the policymakers aiming at convergence in housing affordability.

Suggested Citation

  • Xiaoguang Liu & Jian Yu & Tsun Se Cheong & Michal Wojewodzki, 2022. "The Future Evolution of Housing Price-to-Income Ratio in 171 Chinese Cities," Annals of Economics and Finance, Society for AEF, vol. 23(1), pages 159-196, May.
    • Handle: RePEc:cuf:journl:y:2022:v:23:i:1:liuyucheongwojewodzki
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    References listed on IDEAS

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    More about this item

    Keywords

    Distribution dynamics; Mobility probability plot; Convergence; Housing price-to-income ratio; Economic policy uncertainty;
    All these keywords.

    JEL classification:

    • D39 - Microeconomics - - Distribution - - - Other
    • O18 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure
    • P25 - Political Economy and Comparative Economic Systems - - Socialist and Transition Economies - - - Urban, Rural, and Regional Economics

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