Abstract:
Since the reform of China's housing market, the supply of new housing has continued to increase substantially. But China's real housing price has been rising so fast that it has surpassed the average real housing price increase during the peak period of industrialization in most other developed countries. To address the skyrocketing housing price, China has rolled out various policies targeting the demand side of the real estate market. However, on the supply side, the dominant force is the supply of residential land. Inadequate infrastructure and public service facilities of the metropolitan areas of megacities restrict the improvement of housing supply in these cities. To curb real estate speculation, the key is to develop equity capital markets and personal pensions, and reduce the financial asset investment attribute of real estate. In an environment where the hoarding of land and housing is no longer popular, imposing excessive restrictions on developer loans is not only unnecessary, but will also curb supply and inflate housing prices.
Keywords: housing market, residential land supply, housing supply elasticity
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