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Pair-wise Convergence of Intra-city House Prices in Beijing

Author

Listed:
  • Tommaso Gabrieli
  • Theodore Panagiotidis
  • Yishuang Xu

Abstract

This paper examines the long-run convergence of houses price across the eighteen Beijing districts using monthly dataset that span from January 2006 to December 2014. Following a pair-wise approach, we conduct unit root tests on all N(N-1)/2 possible pairs of housing price differentials across the N districts of Beijing. By doing so we do not select any base-district or regional average as the benchmark. A two-stage approach is employed . In the first stage, unit root tests are employed to investigate the convergence (stationarity) of house price differentials across Beijing. Over half of the intra-city house price differentials are found to be stationary. The second stage of the investigates the drivers of convergence. The probability of a pair being stationarity is affected by income differentials across the eighteen districts, as well as the demographics differentials and supply-side factors. Last we reveal that the half-life of a shock towards long-run price equilibrium is positively affected by distance and housing supply while little evidence can be found for the influence of income and population density.

Suggested Citation

  • Tommaso Gabrieli & Theodore Panagiotidis & Yishuang Xu, 2018. "Pair-wise Convergence of Intra-city House Prices in Beijing," ERES eres2018_236, European Real Estate Society (ERES).
  • Handle: RePEc:arz:wpaper:eres2018_236
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    References listed on IDEAS

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    1. Duran, Hasan Engin & Özdoğan, Hilal, 2020. "Asymmetries across regional housing markets in Turkey," The Journal of Economic Asymmetries, Elsevier, vol. 22(C).

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    More about this item

    Keywords

    Chinese House Prices; Cointegration; House Price Convergence; Pair-wise approach;
    All these keywords.

    JEL classification:

    • R3 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location

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