How does the COVID-19 pandemic affect housing prices in China?

Chong, Terence Tai Leung and Liu, Hengliang (2020): How does the COVID-19 pandemic affect housing prices in China?

Abstract

COVID-19 was first reported in Wuhan in late December 2019, and then spread throughout China, which has had great influence on many aspects of the economy. This paper uses the two-way fixed effects model to investigate the non-linear relationship between the death toll of COVID-19 and the changes in housing prices using monthly panel data from November 2019 to May 2020. The results suggest that there is a U-shaped relationship between monthly death toll of COVID-19 and the percentage changes of housing prices in cities. In addition, the housing markets of New First-tier cities are more sensitive to the COVID-19 pandemic than Second and Third-tier cities, which the pandemic has had little effect on. Similarly, monthly confirmed cases of COVID-19 come to the same conclusions.

• Item Type: MPRA Paper
• Language: English
• Keywords: COVID-19; Housing prices; Non-linear relationship; New First-tier cities
• Subjects: R - Urban, Rural, Regional, Real Estate, and Transportation Economics > R3 - Real Estate Markets, Spatial Production Analysis, and Firm Location > R31 - Housing Supply and Markets

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