Abstract: Starting from the new round of housing market system reform“encouraging both housing purchase and renting”, this paper takes China’s 35 large and medium-sized cities as the research objects and empirically analyses the policy impact of encouraging both housing purchase and renting on the changes of housing prices in the pilot cities based on the panel data from the first quarter of 2016 to the fourth quarter of 2018 by employing the Difference-in-Difference model (DID) and the Difference-in-Difference Propensity Score Matching model (PSM-DID). Then it discusses the impact of the policy on the development of the housing market. The results show that the policy of encouraging both housing purchases and renting has a direct impact on the housing market, which can significantly inhibit the rise in housing prices, but also push up housing rents. Further research finds out that this policy has a more significant degree of inhibiting effect on the prices of new housing and small-area housing than on the prices of second-hand housing and large-area housing.

Key words: encouraging both housing purchase and renting, house price, difference-in-difference model, difference-in-difference propensity score matching model