Stabilizing China's Housing Market

34 Pages Posted: 22 May 2018

See all articles by Richard Koss

Richard Koss

International Monetary Fund (IMF)

Xinrui Shi

Peking University

Date Written: April 2018

Abstract

The sharp rise of house prices in China's Tier-1 cities has fostered a great deal of commentary about the possibility of bubbles forming there. However, China's unique housing market characteristics make it difficult to assess the macroeconomic severity of bursting bubbles, even if they exist. These include the setting of land supply and prices by the government, among many others. The presence of overbuilt 'ghost cities' greatly complicates the ability of traditional macroeconomic policies to address these concerns. This paper looks at proposals to shore up the mortgage underwriting and legal infrastructure to help China withstand the impact of falling prices, should this occur.

Keywords: Housing, China, Asia and Pacific, Mortgage, Housing Demand, Housing Supply and Markets, Government Policy and Regulation

JEL Classification: R21, R31, G21, G28, G38

Suggested Citation

Koss, Richard and Shi, Xinrui, Stabilizing China's Housing Market (April 2018). Available at SSRN: https://ssrn.com/abstract=3182517 or http://dx.doi.org/10.2139/ssrn.3182517

Richard Koss (Contact Author)

International Monetary Fund (IMF) ( email )

700 19th Street, N.W.
Washington, DC 20431
United States

Xinrui Shi

Peking University ( email )

No. 38 Xueyuan Road
Haidian District
Beijing, Beijing 100871
China

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