The impact of macroeconomic policies to real estate market in People's Republic of China
This paper develops a dynamic stochastic general equilibrium (DSGE) model with housing sector to study the effect of China’s new policies to real estate market. The model is estimated by Bayesian Maximum Likelihood methods using ten macro-economic time series over the period Q1 1999 to Q4 2011. The results show that the property tax policy with focus on limiting housing demand by increasing households’ cost of holding housing is good at controlling house prices, but it has a negative impact on housing firms. The land policy concentrated on adjusting housing supply by declining the land cost of housing firms is weak at diminishing housing prices, but it can promote the development of the housing sector and keep real estate market stable.
Volume (Year): 2 (2013)
Issue (Month): 3 (September)
Pages: 75 - 92
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