The Impact of Population Aging on Housing Demand in China Based on System Dynamics

Abstract

In recent years, the proportion of China’s elderly population is gradually increasing, and the real estate market is changing dramatically. Consequently the impact of population aging on housing demand has become increasingly prominent. On the theoretical basis of the relationship between population aging, family structure and housing demand, this paper firstly constructs a system dynamics model of the impact of population aging and family structure on housing demand in China. Then, the model is simulated, and several scenarios of population, family structure, and real estate policies are set up. The main conclusions of this paper are as follows: China’s population will rise at first and then decrease, reaching a peak of 1.401 billion by 2023. As the proportion of elderly population increases, the degree of population aging is becoming increasingly serious. The size of the family will gradually shrink to 2.39 people per household in 2050. The housing demand will increase first and then decrease. Through the results of scenario simulation, this paper puts forward the following suggestion to effectively balance the housing demand in China: Completely relaxing family planning policies, imposing a real estate tax, canceling the pre-sale policy, and raising the loan rate.