Is The Home-purchase Restriction Policy Really Effective?

The real estate industry is critical to China's national economy and employment.In recent years,the high housing prices has become a major problem that plagued the people.Since 2005,some policies have been issued to stabilize the real estate industry,but the effect is limited.In 2009,the growth rate of the housing prices was up to 24.7%,and it continued in the first quarter of 2010.Then,the home-purchase restriction policy was presented and it was expected to control excessive housing prices.So what is the effect of the policy?That's the first issue we need to answer when evaluating it.The previous literature mainly evaluated its influence on housing prices,and concentrated on the analysis of data at city level.This paper not only started from the housing market,but also involved in the impact of this policy on the housing prices and land prices at county level.We also studied the influence of the policy on the divorce rate from the perspective of the marriage market.In the housing market,selecting the price data over 2005-2013,we studied on the influence of the policy on housing prices and land prices,and we found that this policy made the city level housing prices fall 3.2%,the county level housing prices fall 8.6%,and the county level land prices fall 5.9%.In the marriage market,choosing the divorce rate data over 2008-2014,we found that this policy made the divorce rate rise 9.9%.The influence degree of this policy on the divorce rate has heterogeneity in different regions:The more economically developed areas have higher housing prices,so the house purchase through fake divorce gains more benefit,making the divorce rate rise in a bigger degree;Minority areas' culture do not advocate divorce,so people are not inclined to buy a house through a fake divorce,making the divorce rate rise in a smaller degree;In the same way,there is a similar heterogeneity between the south and the north due to cultural difference.This study found that the home-purchase restriction policy could control the housing prices in the short term,but it also brought side effects,like causing fake divorce phenomena,which then made divorce rate increase significantly.