Land and House Price Measurement in China

Yongheng Deng, Joseph Gyourko, Jing Wu

NBER Working Paper No. 18403
Issued in September 2012
NBER Program(s):Public Economics

We provide the first multi-city, constant quality land price index for 35 major markets in China. While there is meaningful heterogeneity in land price growth across cities, on average the last nine years have seen land values skyrocket in many markets, not just those on or near the coast. The typical market has experienced double-digit compound average annual growth in real, constant-quality land values. The 2009-2010 stimulus period typically saw large surges in prices. Three notable characteristics about the land value appreciation series are their strong mean reversion at annual frequencies, the strong common factor in their movement, and their very high volatility. Quantities, not just prices, have been sharply increasing in recent years. The typical amount of space supplied via land auctions in our 35 city sample has doubled since 2008. Some local political economy traits such as the time the local Chinese Communist Party leader has been in office are correlated with land supply volume.

We also investigate the quality of the two most prominent house price indexes in China, and conclude that a traditional hedonic index more accurately reflects how house prices have changed over time in eight major markets in China. Repeat sales indexes have become standard in many countries, but they are not as useful in emerging markets such as China because the bulk of the housing stock is relatively new and has not traded multiple times. A hedonic index shows much higher house price growth over time that do officially published series for the eight markets examined.

download in pdf format
   (637 K)

email paper

A non-technical summary of this paper is available in the February 2013 NBER Digest.  You can sign up to receive the NBER Digest by email.

Machine-readable bibliographic record - MARC, RIS, BibTeX

Document Object Identifier (DOI): 10.3386/w18403

Published: Yongheng Deng, Joseph Gyourko and Jing Wu, “Land and House Price Measurement in China,” in Property Markets and Financial Stability, A. Heath, F. Packer and C. Windsor (ed.), Reserve Bank of Australia, (2012), ISBN: 978-0-9873620-3-2.

Users who downloaded this paper also downloaded* these:
Hirata, Kose, Otrok, and Terrones w18362 Global House Price Fluctuations: Synchronization and Determinants
Liu, Wang, and Zha w17045 Land-price dynamics and macroeconomic fluctuations
Wei, Zhang, and Liu w18000 Status Competition and Housing Prices
Greenstone, List, and Syverson w18392 The Effects of Environmental Regulation on the Competitiveness of U.S. Manufacturing
Cai, Henderson, and Zhang w15067 China's Land Market Auctions: Evidence of Corruption
NBER Videos

National Bureau of Economic Research, 1050 Massachusetts Ave., Cambridge, MA 02138; 617-868-3900; email:

Contact Us