Abstract:

In recent years, in order to dampen the excessive rise of housing prices in China, governments have frequently implemented a series of macroeconomic policies to adjust the housing market. To some extent, house prices in urban China have been shocked by economic policy uncertainty （EPU）. By using the data of 25 big cities in Yangtze River Economic Belt and three urban agglomerations from January 2006 to March 2021, we find that there is a long-term integration between EPU and housing prices through panel integration test. Panel Granger causality test shows that, compared with second-hand housing price, EPU has more significant causality impact on new housing price. PVAR model indicates EPU has no direct significant effect on housing prices, however, the conditional β convergence analysis shows EPU has significantly accelerated the convergence of new housing price and second-hand housing price. Therefore, government should pay attention to the different effects of EPU on the new-built and second-hand housing markets, and implement city-specific policies based on reasonable expectations. Meanwhile, governments can systematically adjust the housing market by taking advantage of the spillover effect of economic policies to achieve the synergetic development of regional housing market.

Key words: economic policy uncertainty, fluctuation of housing prices, Yangtze River Economic Belt, urban agglomeration in the Yangtze River Delta, urban agglomeration in the middle reaches of Yangtze River, Chengdu-Chongqing urban agglomeration