TY  - JOUR
AU  - Glaeser, Edward
AU  - Huang, Wei
AU  - Ma, Yueran
AU  - Shleifer, Andrei
TI  - A Real Estate Boom with Chinese Characteristics
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 22789
PY  - 2016
Y2  - October 2016
DO  - 10.3386/w22789
UR  - http://www.nber.org/papers/w22789
L1  - http://www.nber.org/papers/w22789.pdf
N1  - Author contact info:
Edward L. Glaeser
Department of Economics
315A Littauer Center
Harvard University
Cambridge, MA 02138
Tel: 617/495-0575
Fax: 617/495-7730
E-Mail: eglaeser@harvard.edu

Wei Huang
NUS Business School
Mochtar Riady Building, #7-76
15 Kent Ridge Driver, Singapore 119245
Singapore
Tel: +65 6601 3455
Fax: +65 6779 5059
E-Mail: huangw@nber.org

Yueran Ma
The University of Chicago
Booth School of Business
5807 S. Woodlawn Ave.
Chicago, IL 60637
United States
Tel:  
E-Mail: Yueran.Ma@chicagobooth.edu

Andrei Shleifer
Department of Economics
Harvard University
Littauer Center M-9
Cambridge, MA 02138
Tel: 617/495-5046
Fax: 617/496-1708
E-Mail: ashleifer@harvard.edu
AB  - Chinese housing prices rose by over 10 percent per year in real terms between 2003 and 2014, and are now between two and ten times higher than the construction cost of apartments. At the same time, Chinese developers built 100 billion square feet of residential real estate. This boom has been accompanied by a large increase in the number of vacant homes, held by both developers and households. This boom may turn out to be a housing bubble followed by a crash, yet that future is far from certain. The demand for real estate in China is so strong that current prices might be sustainable, especially given the sparse alternative investments for Chinese households, so long as the level of new supply is radically curtailed. Whether that happens depends on the policies of the Chinese government, which must weigh the benefits of price stability against the costs of restricting urban growth.
ER  -