Price and Volume Divergence in China’s Real Estate Markets: The Role of Local Governments
研究发现2020-2022年疫情期间中国城市房价上涨但成交量下降，地方政府通过供应控制、融资平台购地和限制销售许可等手段干预市场，加剧了开发商财务困境。
Abstract During the COVID-19 pandemic (2020-2022), Chinese cities witnessed a paradox: residential land and new house prices surged while transaction volumes plummeted. We attribute this to local governments’ active price management through supply controls, land acquisitions by local government financing vehicles (LGFVs), and limits on new home sales permits. Cities more dependent on land sales and land-backed debt before the pandemic experienced greater price increases and price–volume divergence, with LGFVs buying more land at higher prices than other buyers. These interventions helped sustain fiscal financing but deepened developers’ financial distress, revealing unintended consequences of local governments’ fiscal strategies during downturns.