Purchase Restrictions Research Articles

The Impact of Real Estate Purchase Restriction Policy on Urban Economic Development—A Case Study of Beijing

Since 2010, Beijing's purchase restriction policy has been adjusted several times to adapt to the market and promote stability. In April 2024, the policy was eased for housing areas outside the Fifth Ring Road, marking the first major adjustment in 13 years. This paper analyses the economic impact of Beijing's real estate purchase restriction policy, focusing on its effect on investment, consumption, industrial structure, and employment. The study indicates that the purchase restriction policy initially hinders investment and consumption in the short term but contributes to market stability and industrial optimization in the long run. The policy change has increased housing sales and growth in related industries outside the Fifth Ring Road, promoting economic development in the suburbs. Furthermore, the policy has a nuanced impact on the employment market, encouraging labor mobility toward high-tech and service industries while affecting employment in real estate-related sectors. The study suggests that policymakers need to consider the impacts of various aspects to ensure the healthy development of the real estate and employment markets.

Marriage entry, divorce and reconciliation: The unintended consequence of the home purchase restriction policy in China

This study investigates the unintended socioeconomic consequences of housing market regulations, focusing on the home purchase restriction (HPR) policy implemented in cities across China. While the primary aim of the HPR policy is to curb property prices by limiting the number of properties a household can purchase, its broader impact on family formation, particularly marriage and divorce patterns, remains underexplored. Applying Becker’s economic theory of marriage, which views marital decisions as rational choices influenced by socioeconomic factors, this study examines how the HPR policy affects family formation and dissolution across different city tiers and age groups in China. Our analysis reveals several key findings. First, the HPR policy effectively contributed to a decrease in house prices, aligning with its primary objective. However, it also led to delayed marriages among younger age groups, especially in first-tier cities, where housing affordability is a significant concern. Second, the policy inadvertently encouraged strategic divorces, allowing couples to circumvent purchase restrictions and acquire additional properties. This loophole undermines the policy’s effectiveness in reducing housing demand and stabilizing prices. These results highlight the complex interplay between housing market regulations and family demographics, emphasizing the need for policymakers to consider the broader societal impacts of non-family-oriented policies. As China, like many other societies, faces challenges related to the second demographic transition—such as declining marriage and fertility rates—the findings of this study serve as a cautionary tale. Housing policies, while effective in addressing market concerns, can have significant and sometimes counterproductive effects on family stability and formation, potentially exacerbating the demographic trends a society aims to mitigate.

The effect of the end-number license plate driving restriction on reducing air pollution in China

This study investigates the long-term efficiency of the long-run end-number license plate driving restriction in China, a traffic control policy that is partially aimed at reducing urban air pollution. A difference-in-differences regression is performed on a panel including nine cities that implemented this policy in staggered manner between 2008 and 2013. The results show that overall, this driving restriction does not improve air pollution in policy cities over the long-term. Quantitatively, the city-level air quality index has close-zero statistically insignificant changes by the policy, reaching only 3.9% reduction by 95% confidence interval lower bound of the estimate, translating to welfare gains of only 11.24 USD (70.62 CNY) per person per year, or 0.447 life years per capita. Further analysis with regression discontinuity in time and heterogeneity subgroup analysis illustrates that air pollution may first decrease due to the policy but then bounce back because of the behavioral adaptations of drivers purchasing a second car in cities without simultaneous car purchase restrictions. This shows that need to combine the end-number license plate policy with car purchase restrictions or electric vehicle promotions to achieve effective air pollution reductions over the long-term.

Interpreting the "Unbundling" of Purchase Restrictions in China's Property Markets from Volume and Price Perspectives

Interpreting the "Unbundling" of Purchase Restrictions in China's Property Markets from Volume and Price Perspectives

Forecasting Urban Housing Land Needs: A Comparative Analysis of Chinese Cities

In urban centers across China, the actual annual land supply frequently fails to meet government projections, significantly impacting local economic and social development. This study bridges the gap in prospective analyses of governmental decision-making concerning urban housing land supply. Employing fuzzy set qualitative comparative analysis, this research examines the housing land supply in 50 Chinese cities, including 16 first-tier and 34 non-first-tier cities. The goal is to explore the decision-making combinations that influence the supply of housing land, thereby aiding in the formulation of governmental policies. Our findings indicate that in first-tier cities, forward-looking decisions rely on low fiscal pressure, with purchase restrictions and land supply restructuring acting in tandem. In contrast, in non-first-tier cities, high population density or significant fiscal pressure necessitate enhancements in land supply structures without implementing purchase restrictions to sustain forward-looking governance. Additionally, while forward-looking decisions depend on numerous conditions, it is generally simpler to circumvent non-forward-looking decisions. This investigation integrates forward-looking theory into real estate research, offering valuable insights for the formulation of governmental land supply strategies.

A Study on the Financial Situation Changes of Major A-share Real Estate Companies Since the Adjustment of Purchase Restriction Policies

To prevent over expansion of property bubbles in China, housing purchase restriction policies were put into effect in 2010. Nevertheless, to be adaptable to economic conditions at that time, there was firstly a relaxation of housing purchase restriction policies in 2014 and after that, several more adjustments were made. By analyzing the financial indicators of the main real estate enterprises in A-share market, this paper wants to find the general trends and common features of those corporations under policy adjustments and changeable market environment. The analysis results show that the majority of firms kept high levels of debt and inventory all the time and from 2014 to 2019, most companies net income margins, net income and operation revenue generally kept increasing. However, as the Coronavirus pandemic broke out at the end of 2019, those profitability measures started to decrease widely and sequentially, even with a new round of policy easing. Facing with this situation, it is suggested that to prevent debt risks, property enterprises could take deleveraging and destocking into consideration and to achieve a soft landing of the housing market, new ways of policy adjustment could be implemented by the government.

Examining the policy outcomes of cancelling the house purchase restriction: quasi-experimental evidence from China

While the impact of the house purchase restriction (HPR) policy on the housing market in China has been deeply examined, there is still little known about how the housing market varies when such policy is abandoned. To fill this gap, we first theoretically propose two hypotheses concerning the relationship between abandoning HPR policy and housing price and transaction based on the housing literature. We then examine the hypotheses by taking Jinan, China as empirical case that offer an excellent policy setting of some districts having discarded the policy while the other remains. The results derived from Synthetic Control Method (SCM) showed that the cancellation of the HPR policy plays a vital role in increasing the transaction volume, but it fails to promote house prices. The findings remain reliable after a series of placebo and robustness tests. This article adds new insight to the debate on efficacy of government intervention via more granular quantitative data, and further contributes to policy implications regarding housing market development.

Unleashing the real estate market: assessing the impact of relaxed housing purchase restriction policy on house prices in China

ABSTRACT This study examines the effects of the relaxed housing purchase restriction (RHPR) policy on house prices in China, using panel data from 41 cities between January 2021 and June 2022. The study finds that the RHPR policy has a positive effect on the existing housing market, contributing to its stabilization. However, the impact on new house prices is unclear. Mechanism analysis indicates that the policy effectively boosts house demand and fosters positive market expectations. The study also finds that the policy has a greater impact on second-tier and northern cities. Additionally, the research indicates that the policy has stimulated house demand among non-registered populations and in non-restricted purchase zones. These results emphasize the importance of timely adjustment and optimization of real estate policies to maintain a stable and sustainable market.

The Impact of Real Estate Purchase Restriction Policy on Urban Economic Development—A Case Study of Beijing

Since 2010, Beijing's purchase restriction policy has been adjusted several times to adapt to the market and promote stability. In April 2024, the policy was eased for housing areas outside the Fifth Ring Road, marking the first major adjustment in 13 years. This paper analyses the economic impact of Beijing's real estate purchase restriction policy, focusing on its effect on investment, consumption, industrial structure, and employment. The study indicates that the purchase restriction policy initially hinders investment and consumption in the short term but contributes to market stability and industrial optimization in the long run. The policy change has increased housing sales and growth in related industries outside the Fifth Ring Road, promoting economic development in the suburbs. Furthermore, the policy has a nuanced impact on the employment market, encouraging labor mobility toward high-tech and service industries while affecting employment in real estate-related sectors. The study suggests that policymakers need to consider the impacts of various aspects to ensure the healthy development of the real estate and employment markets.

The Impact of Curbing Housing Speculation on Household Entrepreneurship in China

We document a speculation channel and complement the well-documented collateral channels by offering novel evidence about the effect of curbing housing speculation policies We estimate the positive effect of discouraging housing speculation on household entrepreneurship in China. By exploiting the city-level variations in the stringency of home purchase restrictions between 2011 and 2019 and five waves of China Household Finance Survey (CHFS) data, we find that discouraging housing speculation significantly increases the likelihood of local households starting a business. To address endogeneity concerns, we exploit plausibly exogenous variation using IV estimations and DID research design. The positive effect is stronger for local multiple-home owners, homeowners without mortgage debt, households with previous entrepreneurial experience, households of risk-loving, and households with large assets. This conclusion is robust with city-level evidence. In the mechanism discussion, we find that discouraging housing speculation significantly reduces the likelihood and the plans of local households to purchase new homes and lowers the house price expectations of local households (thus the opportunity cost of starting a business). We also provide evidence supporting the view that discouraging housing speculation increases entrepreneurial opportunities, innovative development, and local households’ social network investments, all of which contribute to starting a business. The results imply that policies to curb housing speculation can lead to beneficial spillover on entrepreneurship and the local economy, as well as contribute to the sustainability of economic growth.

Analysis on Impact of Purchase Restrictions on Housing Prices in Chengdu

This study delves into the intricacies of Chengdu's housing market, particularly focusing on the ramifications of purchase limitations imposed on property prices during the 2016-2017 period when purchase restrictions are issued. By employing the ARIMA (9,1,0) model for time series analysis and using the ARIMA model to analyze the price changes in Chengdu's housing market, it was discerned that, in contrast to expectations, property prices in Chengdu exhibited an upward trend despite the introduction of these purchase restrictions. This unexpected outcome underscores the multifaceted nature of housing market dynamics, underlining the necessity of taking into account regional and local variables. The findings of this research carry substantial implications for policymakers, highlighting the imperative of crafting more localized strategies and maintaining consistent market surveillance. For policymakers along with investors, the study sheds light on the importance of incorporating a diverse array of market indicators, such as demographic shifts and prevailing economic trends, into their investment or policy decision-making framework.

The Effect of House Prices on Fertility: Evidence from House Purchase Restrictions

The Effect of House Prices on Fertility: Evidence from House Purchase Restrictions

Effects of Inclusion of Food Purchase Restrictions and Incentives in a Food Benefit Program on Diet Quality and Food Purchasing: Results From a Randomized Trial

BackgroundThere is interest in reshaping the Supplemental Nutrition Assistance Program (SNAP) to better support family nutrition. ObjectiveThe Grocery Assistance Program Study (GAPS) for Families evaluated the effects of prohibiting using program funds for the purchase of certain sugary foods on the nutritional quality of foods purchased and consumed by program participants. DesignA randomized experimental trial was carried out with participants randomized to one of three food benefit conditions. Baseline and follow-up measures collected included interviewer-administered 24-hour dietary recalls, food purchase receipts, food security, height, and weight. Participant/settingAdult–child dyads in households eligible for SNAP but currently not enrolled were recruited from the Minneapolis/St Paul MN metropolitan area from May of 2018 through May of 2019. A total of 293 adult–child dyads received the intervention as allocated. Of these dyads, 233 adults completed follow-up measures and met criteria for inclusion in the analytic sample, resulting in an attrition rate of 20.5%. A total of 224 children completed follow-up measures and met criteria for inclusion in the analytic sample, resulting in an attrition rate of 23.5%. InterventionParticipants were randomized to 1 of 3 conditions: restriction (not allowed to buy sugar-sweetened beverages [SSB], sweet baked goods, or candy with program funds); restriction paired with incentive (30% incentive for fruits and vegetables [FV] purchased with funds); and control (funds provided with no restrictions or incentives). Funds were provided on a 4-week cycle for 20 weeks via a study-provided debit card. Main outcome measuresThe primary outcome was the Healthy Eating Index (HEI)-2015 total score. Additional outcomes included selected HEI-2015 component scores; energy intake; food security; body weight; and purchasing of SSB, sweet baked goods, candies, fruits, and vegetables. Statistical analysisLinear regression analyses were conducted with change in the outcome regressed on treatment condition for the primary outcome analyses. ResultsNo differences were observed between conditions in change in the nutrition and food security measures examined. Purchases of SSB and sweet baked goods and candies significantly differed by experimental condition. Purchase of restricted foods was lower at follow-up in the restriction and restriction paired with incentive conditions compared with the control condition. For example, spending on SSB at follow-up was significantly lower in the restriction ($2.66/week) and restriction paired with incentive ($2.06/week) conditions in comparison with control condition ($4.44/week) (P < 0.0003 and P < 0.0001, respectively). ConclusionsThis study failed to find evidence in support of prohibiting the purchase of sugary foods with food program funds as a strategy to improve program participant nutrition, even when paired with an FV incentive. Research carried out in the context of the SNAP program is needed for a more robust evidence base.

Building and carbon emissions: Evidence from real estate purchase restriction policy

Carbon emission reduction in the building sector plays an essential role in the global mitigation effort, and a policy of limiting the expansion of buildings could be a critical intervention. Previous studies mainly focused on the process and materials in the building sector to discuss ways of building decarbonization rather than the restriction of building expansion. The Real Estate Purchase Restriction policy in China produced powerful enforcement to control the disorder expansion of building construction in China. Using the difference-in-differences model, this study finds that the policy caused approximately 5.7 million tons of carbon emissions decrease per year in the pilot cities, which could save about 52.55 million dollars social cost of carbon. Through the examination of the impact mechanism, we found that the implementation of real estate purchase restriction policy contributed to carbon emissions' reduction via reducing population growth and reducing freight volume.

Retailer's ordering decisions with consumer panic buying under unexpected events

A disruption in demand caused by unexpected events, such as extreme weather and epidemics can trigger panic buying by consumers, adversely affecting firms' inventory management. From the demand side, focusing on event-sensitive products, this paper develops an analytical model to examine how consumer panic buying behaviors resulting from unexpected events affects a retailer's ordering decisions and expected profits under both practices without and with purchase restriction policies. The main results are as follows. First, consumer panic buying behavior pushes the retailer to increase the order quantity in the first period and reduce the order quantity in the second stage. Second, regardless of the possibility of unexpected events, a moderate panic buying level is most beneficial to the retailer. Third, a large inventory capacity is always advantageous for the retailer to cope with unexpected events without a purchase restriction policy, whereas only when the inventory capacity is at a moderate level, the retailer can benefit from consumer panic buying under a purchase restriction policy. In addition, the impact of consumer panic buying behavior on the retailer's profit remains unchanged under the risk of supply interruption. However, considering an emergency order, when panic buying is not too intensive to lead to a loss of demand in the first period, it can still harm the retailer in some cases.

Inside job: Evidence from the Chinese housing market

AbstractUsing a comprehensive data set of housing transactions in Beijing, China, we find that government officials are more likely than non‐officials to buy housing units before the government‐imposed housing purchase restriction policy. We also find that officials use their power to speed up the loan application process and pay higher prices to complete the transactions before the policy. Overall, the results suggest that officials trade on private information gained during the policymaking process.

Do local governments capitalise on the spillover effect in the housing market? Quasi-experimental evidence from house purchase restrictions in China

This study used the house purchase restriction (HPR) policy applied between 2016 and 2017 in China to investigate whether local governments actively capitalised on the spillover effects induced by housing policy in adjacent cities. The difference-in-differences (DID) model was employed to estimate the spillover effects of HPR policy on land and bond markets for treatment cities and control cities. After implementation of the HPR policy, land conveyance area and land revenue in unregulated cities adjacent to regulated cities, increased by 32.4% and 47.3%, respectively, relative to nearby unregulated cities not adjacent to regulated cities. The issuance volume of urban investment bonds, which heavily relies on land price and revenue, in unregulated cities adjacent to regulated cities, increased by 163.5% in comparison with nearby control cities and the yield spread of newly issued bonds decreased. Overall, this study indicates that local governments actively capitalise on the spillover effects induced by housing policy in adjacent cities.

Housing purchase intention of the floating population under the home purchase restriction policy in China

Housing security is fundamental to the life of rural-urban migrants in cities, and the housing choices of rural-urban migrants have drawn increasing attention in recent studies. However, the role of housing policies is still yet to be explored. This paper aims to investigate the effect of housing policies on rural-urban migrants’ purchasing intention. Taking China as an example, the empirical results indicate that, somewhat surprisingly, the home purchase restriction policy implemented by the Chinese government raises the floating population’s intention to purchase houses in the host city. Yet, such a linkage varies with income and housing status among the floating population, while it gives rise to changes in their consumption behaviors. This study thus provides new insights into the effect of housing policies and how floating populations make housing purchase decisions, yielding critical implications on how to optimize housing policies.

Pricing Game Models of Hybrid Channel Supply Chain: A Strategic Consumer Behavior Perspective

The current sales model combining online and offline channels meets the diverse requirements of consumers. However, consumers’ inter-channel switching behavior and strategic behavior also pose significant challenges to pricing decisions in the hybrid channel. Using game theory and consumer utility theory, a retailer-driven pricing model is developed to study the optimal pricing problem for each channel in a mixed-channel supply chain considering the characteristics of channel competition and the waiting behavior of strategic consumers. Study results show there is a negative correlation between the proportion of strategic consumers and the optimal pricing and profit of each channel, and as the proportion of strategic consumers rises, the optimal pricing and profit of manufacturers and retailers all trend downward. Incorporating strategic consumers into the pricing model will assist the supply chain in elucidating the behavior of consumer heterogeneity during various decision-making periods and in making reasonable pricing decisions. Effective guiding strategies, such as pre-discount and purchase restrictions, can reduce the profit loss caused by strategic consumer behavior. The optimal combination of pre-announcement discount and strategic consumer ratio can generate the greatest profit for retailers and the supply chain.

Purchase restrictions as a tobacco control policy: An analysis of the effect on adverse birth outcomes

The association between smoking during pregnancy and adverse birth outcomes is well known. Various tobacco control policies, however, may improve birth outcomes differently. We first study the effects of legal restrictions on purchasing tobacco products on adverse birth outcomes. The main outcome measure of interest is the causal effect of a purchase restriction on tobacco products on the probability of an adverse birth outcome. Our identification strategy utilizes the variation in the minimum legal sales age of tobacco products over time and across geographic regions within the US during 2013–2018 in a two-way fixed effects framework. We used restricted-use birth records of all live births in the US during that period by birthing people who were 18–21 years at delivery. We find that an age-based purchase restriction on tobacco products causes the incidence of adverse birth outcome to reduce by 9.5%. Our results suggest that purchase restrictions are highly effective in reducing adverse birth outcomes in deliveries by birthing people in the 18–21 age group and provide additional support for the campaign for further increasing the minimum legal sales age of tobacco products.