Over the past two decades, China’s urban house market has experienced significant price appreciation, driven by a sustained influx of population. However, as population shrinkage has become an increasingly notable urban phenomenon, its interaction with house prices remains inadequately understood, particularly within the institutional context of China’s household registration (hukou) system. This paper examines the effect of population change on house prices by incorporating the role of a city’s hukou value, using Dongguan as a case study. By disaggregating the population by two hukou-based categories (i.e., hukou location and hukou type), this study presents three main findings: (1) The hukou influences the relationship between house prices and population change, with house price appreciation closely linked to increases in both the household population and the urban hukou population. (2) While house prices respond synchronously to the growth in these population groups, their response to the shrinkage of temporary residents and rural hukou population exhibits a distinct temporal hysteresis. (3) The effect of population change on house prices remains confined within towns, even though there are broader spatial spillovers across Dongguan’s towns in the house market.
Zhiwei Du (Fri,) studied this question.