Abstract: In addition to directly affecting urban households’ consumption, population aging can also indirectly affect urban households’ consumption through housing price. This paper divides urban households into patient and impatient households based on the heterogeneity expectations of urban households on future changes in housing prices. It adds population aging shock and housing preference shock to the dynamic stochastic general equilibrium model which includes patient and impatient households as well as housing development enterprises, so as to study the impact of population ageing on urban households’ consumption rate through housing price-to-income ratio. The results show that: population aging will increase the consumption rate of patient households, while inhibiting the consumption rate of impatient households; population aging will significantly increase the consumption rate of patient households through the direct wealth effect of life cycle hypothesis; population aging will significantly inhibit the consumption rate of impatient households through the indirect substitution effect of housing price-to-income ratio.

Key words: dynamic stochastic general equilibrium model, population aging, housing price-to-income ratio, consumption rate