Housing pathways and homeownership determinants of the young middle class in Beijing, China

Abstract

The transition from welfare allocation towards market-oriented provision of housing led to overheated housing investment and soaring house prices in China’s major cities. The deteriorating housing affordability had affected the housing pathways of the young middle class, and of most relevance, towards obtaining homeownership. However, the existing hukou based housing system made the young middle class a “sandwich class” who had difficulties in accessing both commodity and public housing. Thus the aim of this research is to investigate the housing pathways and homeownership determinants for the young middle class in Beijing. This research was guided by two research questions: what are the typical housing pathways adopted by young middle class, and what are the determinants and how do they interact towards young middle class homeownership? A quantitative research approach and a survey research design were adopted to conduct this research. Through an internet-based survey, a sample of 797 respondents was collected. Logistic regression and structural equation modelling were adopted to analyse the data. Five major tenure pathways adopted by the young middle class have been identified: through private rental towards homeownership; the parents’ home towards homeownership; work unit housing towards homeownership; stay in parents’ home; and stay in private rental dwellings. The pathway through private rental to homeownership was the dominant choice for the young middle class. This research found that homeownership of the young middle class in Beijing was related to life events of marriage and child birth, age, hukou, parents’ income, father’s occupation, attitudes towards homeownership and Chinese culture. The attitudes towards homeownership were influenced by marriage and Chinese culture of group conformity. The influences of marriage and culture on attitudes were moderated by the level of housing affordability and availability. It is concluded that the policy makers should establish special measures to address the housing problems of the young middle class such as first home buyers grant and private rental management. It is suggested that future researchers need to consider attitudes towards homeownership, institutional factors, parental supports and the moderating effects of housing market and policies in analysing homeownership.