The Evaluation Of Reform Of Property Tax And Effect On The Price Of Real Estate

The reform of property tax started in February28,2011，Shanghai and chongqingselected for pilot cities. This paper analyses the property tax evolution process, based onthe comparison of foreign real estate tax policy, further commenting on China real estatetax reform rules.Since the reform of property tax has increased the cost of ownership aswell as restrained the demand of houses and speculative behavior, it affects the variationof house price.Real estate tax reform in it has been more than one year, this paper studies the realestate tax reform inhibition effect of house-price. First， this paper analyzes the reform ofproperty tax on the price impact and the transmission mechanism, and then throughconstructing consumer-developer model and investor-developer model proved theinference. Taking the implement of property tax in February,2011in Shanghai andChongqing as a natural experiment, the paper takes the Synthetic Control Methods in theproject evaluation to estimate the influence of property tax on house prices of pilot city.Based on forty large and medium-sized cities panel data from June2010to February2012,we find the property tax imposed in February of2011has noticeably restrained the trendof house price in Pilot city rising. The implementation of property tax reduced the averagehouse price by165.83-358.99yuan/m~2in pilot city relative to implicit housing price. Thedecline range is5.36%. And a series of placebo test also confirmed that influence ofproperty tax is statistically significant. Based on the effect of further decomposition, wefound that the main effect of property tax is on more than144square meters houses,below90square meters houses appeared severe rise, this remind us that we shouldcarefully consider the current stage of the Property Tax Policy.