An Analysis of Restrictions on Housing Purchases in China

Abstract

In recent years, housing prices have increased rapidly in China. As a result, Chinese governments have taken measures to control prices. The most popular way is restrictions on housing purchases. However, this policy has been questioned since it was implemented. The writer focusses on whether this policy is suitable and reasonable for the housing market. Firstly, the writer analyzes the reasons for high housing prices in China. The reason is not related to supply and demand, but rather to financial and fiscal problems. Secondly, the writer provides more details about the adverse effects of restrictions on housing purchases, and explains why they are not sustainable for the Chinese housing market. Then an analysis of foreign policies provides some clever ideas for alternative policies to reduce housing prices. Finally, the writer gives her own thoughts about policies in the Chinese housing market.