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Cohort Effects, Differential Accumulation and Hong Kong's Volatile Housing Market

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  • Ray Forrest

    (School for Policy Studies, University of Bristol, 8 Priory Road, Bristol, BS8 1TZ, UK, r.forrest@bristol.ac.uk)

  • James Lee

    (Public and Social Administration Department, City University of Hong Kong, Tat Chee Avenue, Kowloon Tong, Hong Kong, sakclee@cityu.edu.hk)

Abstract

As in much of east Asia, the past few decades have seen extraordinary rates of house price inflation in Hong Kong. After a relatively modest downturn in the early 1980s, prices rose rapidly until the Asian financial crisis in 1997. Since then, and despite increased government efforts to stimulate the stagnant property market, prices have continued to fall and negative equity remains pervasive. Given the centrality of property investment and speculation historically for households, financial institutions and for wider government economic strategies, the state of the residential market remains of central political and policy concern. Against this background of Hong Kong's apparently declining economic fortunes and major shifts in housing policy, this paper explores aspects of wealth accumulation in the home-ownership sector. Linking to a well-established set of debates in the academic literature, the paper explores the impact of policy change and house price trajectories on different cohorts of households. For example, those cohorts who entered home-ownership in the late 1980s generally saw rapid increases in their property values fuelled by generous state-assisted home-ownership schemes and a buoyant economy. By contrast, those entering in the late 1990s have experienced a much less favourable policy and economic environment. The paper also explores the extent to which price trajectories have varied in different sectors.

Suggested Citation

  • Ray Forrest & James Lee, 2004. "Cohort Effects, Differential Accumulation and Hong Kong's Volatile Housing Market," Urban Studies, Urban Studies Journal Limited, vol. 41(11), pages 2181-2196, October.
  • Handle: RePEc:sae:urbstu:v:41:y:2004:i:11:p:2181-2196
    DOI: 10.1080/0042098042000268401
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    References listed on IDEAS

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    Cited by:

    1. Wai-Ming To & Peter K. C. Lee, 2017. "Energy Consumption and Economic Development in Hong Kong, China," Energies, MDPI, vol. 10(11), pages 1-13, November.
    2. Evren Ceritoglu, 2017. "Disentangling Age and Cohorts Effects on Home-Ownership and Housing Wealth in Turkey," Working Papers 1706, Research and Monetary Policy Department, Central Bank of the Republic of Turkey.

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