On The Impact Of Property Tax Reform On Housing Price Stability

Since the urban housing system began to undergo further reform in 1998,the property market’s explosive growth has played a crucial role in fostering local social and economic development,particularly when it comes to the construction of urban infrastructure.However,the growth of the real estate industry also has increased home costs beyond what locals can pay.The housing issue affects the public’s most important interests.Maintaining stability,pursuing advancement while preserving stability,and working to keep the real estate industry growing steadily and healthily are vital components of the government’s housing activity today and for a very long time to come.The State Council was given permission by the National People’s Congress Standing Committee to conduct real estate tax trials in some areas in 2021,and this strengthened the argument for energetically but sensibly advancing real estate tax legislation and reform.The impact of property taxes on the stability of the housing market’s pricing is very important practically in this situation.In this paper,we present a theoretical analysis of the impact of the property tax on housing market price stability using a combination of the history of property tax policy development,a review of the practice and experience of property tax reform in Shanghai and Chongqing,and the equilibrium price in housing supply theory.In order to forecast changes in various aspects of the housing market in Hangzhou,a system dynamics model of property tax on housing market price stability has been built.This study investigates how to construct the tax base rate to stabilize housing prices and deflate market bubbles based on the system dynamics simulation findings of three real estate tax policy reform schemes.This article investigates whether the adoption of real estate tax policy can support the long-term steady growth of housing market values and accomplish the goal of "housing with housing" on the basis of the simulated experiment of the rent-purchase policy and put-up pertinent policy suggestions.The following are,in brief,the key conclusions and research findings of this paper:(1)The housing market can be divided into housing use market and housing asset market.The production and price of housing are determined in the asset market,and the function of the housing use market is to determine the rent level.The implementation of the property tax will increase the future holding cost of housing investors and the expected rate of return of continuing to hold the housing,thus affecting the number of newly built housing,rent level and housing price.(2)The commercial housing market and housing rental market are classified into three subsystems of core market components and four subsystems of market influencing elements,according to the examination of the influence mechanism of the real estate tax reform on the price stability of the housing market.The supply of housing will be impacted by the land market subsystem,the demand for housing will be impacted by the urban population subsystem,the supply of housing will be impacted by the real estate tax regulation policy subsystem,the urban economic development level will be impacted by the supply and demand of housing,and the stability of housing prices will be impacted by the overall subsystem.(3)After clarifying the transmission mechanism of the property tax reform on the price stability of the housing market,through the scenario simulation of the real system of property tax and rent-purchase simultaneous policy,it is observed that the scheme of property tax collection adopts a broad tax base tax rate,imposes a low tax rate on the ordinary small area housing of most groups,and imposes a high tax rate on the high-end housing of a small group.It can make the housing market price more inclined to the market equilibrium price,that is,it can stabilize the housing market price and squeeze out the market bubble.On this basis,improving relevant policies of the housing rental market is conducive to further realizing the goal of "housing with housing".(4)In order to promote the stability of the housing market price,the design of the property tax should take full account of regional differences and the needs of middle and low income groups,release the stock of housing resources of past investment surplus while continuing to collect the property tax,and use the real estate tax for basic public services;The design of property tax should encourage the rental of existing housing,increase the supply of rental market,and activate the second-hand housing market.According to the housing needs of different income groups to formulate housing policies,using tax regulation mechanism to open multi-channel supply path;In light of urban population flow and housing inventory,we will formulate cross-cycle policies for the transfer of residential land,and introduce targeted policies to ensure adequate housing for low-and middle-income groups and measures to prevent risks.