The factors that impact the housing price: an empirical study based on Chinese provinces

Abstract

This paper examines the trend of housing prices in 31 provinces and cities in China from 1999 to 2018, and uses fixed-effect estimates to analyze the impact of GDP, income level, CPI, unemployment rate and population on housing prices, and finds that GDP and income have positive impacts on housing prices. In addition, housing prices in the eastern region are much higher than those in the central and western regions, and over time, the gap between housing prices in the central region and western region are both growing. In order to study this phenomenon, the fixed effects of housing prices in the eastern, central and western regions will be used. Finally, it is found that the increase in unit income in the eastern region leads to a much higher rate of housing prices than in the central and western regions. The higher marginal buying tendency of consumers in the eastern region is an important reason for the higher growth rate of housing prices in the eastern region than in other regions.