Uncovering the pathways between house prices and depressive symptoms in Chinese cities: a nationally representative study

Abstract

Using data from the 2016 China Labour-force Dynamic Survey (CLDS) and ordinary least square (OLS) analysis with the instrumental variable (IV) method, this study examined causal relationships between house prices (both the level and growth rate) and depressive symptoms, particularly investigating their pathways and the moderating effects of housing tenure, house price trend, and house value appreciation. Results showed that both the level and growth rate of house prices lowered homeowners’ levels of depressive symptoms and the effects were strengthened by upward trends of house prices, but the rise in house price growth rate was associated with a higher level of depressive symptoms in renters. There was no evidence to support the idea that the effect of house prices varied in relation to unrealized house value appreciation or depreciation. Results reveal the mediating role of physical activity and house value in the relationship between house prices and depressive symptoms in homeowners, supporting the wealth effect theory. However, the rise in both the level and the growth rate of house prices was related to a lower level of perceived social status, which in turn was correlated with a higher level of depressive symptoms. Contrary to the socioeconomic effect theory, the level of house prices is positively related to the expenditure on urban construction and maintenance, which is correlated with a higher level of depressive symptoms in homeowners. These findings provide important implications for policies to improve mental health and wellbeing in the Chinese context.

Keywords:

• Level of house prices
• house price growth rate
• depressive symptoms
• moderating effect
• pathways
• China

Disclosure statement

There is no conflict of interest among the authors.

Notes

1 Endogeneity refers to the situation in which an explanatory variable is correlated with the error term owing to unobserved or omitted variables or independent variables measured with error. The problem of endogeneity leads to estimation bias, and the instrumental variable approach is commonly used to address this problem.

2 Data used in this article is from the China Labour-force Dynamics Survey (CLDS), conducted by the Centre for Social Science Survey at Sun Yat-Sen University in Guangzhou, China. The opinions are the author’s alone. Please refer to http://css.sysu.edu.cn for more information about the CLDS data.

3 Considering that only people aged above 18 are eligible to purchase residential properties in China, house prices might have little influence on those aged under 18. Therefore, we omitted respondents aged under 18 from our analysis.

4 Hukou is a system of household registration in China. Hukou status can be divided into local hukou and non-local hukou. Local hukou refers to people who were registered with the city where they were living at the time of the survey; non-local hukou refers to people who were not registered with the city where they were living at the time of the survey. The hukou system is a major tool of social control and public services allocation. People in urban areas without local hukou have limited access to various public goods and services, such as education, pensions, medical services, and affordable housing.

5 We also included the number of housing properties as a covariate in the models for renters. Although some of the respondents did not own their current residences (renters), they might own other residential properties in the cities where they were living or in other cities.

Additional information

Funding

This work was supported by the National Natural Science Foundation of China [42171196, 41871140, 41971194] and the Program for Guangdong Introducing Innovative and Entrepreneurial Teams [No. 2017ZT07X355].