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Do bank loans and local amenities explain Chinese urban house prices

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  • Daisy J. Huang
  • Charles Ka Yui Leung
  • Baozhi Qu

Abstract

Based on Chinese city-level data from 1999 to 2012 and controlling for geological, environmental, and social diversity, this study suggests that credit plays a significant role in driving up house prices after the Great Recession, whereas property prices only influence bank lending before 2008. Local amenities such as higher education, green infrastructure, healthcare, and climate also positively affect house prices. Moreover, the impacts of bank loans on housing prices tend to be related to the level of amenities, suggesting an integrated approach (i.e. combining macroeconomic and urban economic variables) of housing market for the future research.

Suggested Citation

  • Daisy J. Huang & Charles Ka Yui Leung & Baozhi Qu, 2015. "Do bank loans and local amenities explain Chinese urban house prices," ISER Discussion Paper 0928, Institute of Social and Economic Research, Osaka University.
    • Handle: RePEc:dpr:wpaper:0928
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    JEL classification:

    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • O18 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes

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