Housing Affordability Analysis Based on D-HAQ Model

Abstract

Housing affordability is an indicator to reflect the purchasing power of residents. Many factors have to be considered in the measurements. A Dynamic Housing Affordability Quadrant Model (D-HAQ) is proposed to integrate more dimensions of affordability for visualizing. D-HAQ assesses the housing affordability from three aspects, down payment ability (DPA), monthly repayment ability (MRA), and time to achieve adequate MRA (TAM). Compared with the traditional housing affordability methods, the D-HAQ model is dynamic and visible. Based on the D-HAQ model and the construction of big data fusion platform for government service, a framework of housing affordability evaluation system is presented. Meanwhile, we conduct an empirical analysis by using the data of 35 major cities in mainland China. Besides, this paper analyses the impact of implementing favored mortgage interest rates, finding that for households with poor housing affordability, it has little effect on improving their affordability.