Lifecycle housing preferences of middle class residents in Guangzhou : an analytic hierarchy process (AHP) approach

Abstract

Improving the quality of urban residential environment is one of the main concerns and the knowledge of individual-level housing preferences is essential for urban planning and sustainable development. However, micro-level empirical studies on housing preferences are insufficient, especially in urban China who has experienced tremendous changes during the urban housing reform. This thesis therefore aims at exploring whether and how the consumers’ preferences on housing attributes vary with the demographic and socio-economic characteristics, with the stated preference data collected from Guangzhou during March and April in 2014. Among the total 655 distributed and collected questionnaires, 349 respondents are satisfied with the consistency requirement and are used in the analyses.

An overview of the urban housing system reform in China is presented at the first place, with special reference to Guangzhou, which sets the context of this study. Based on an extensive literature review, eighteen housing attributes are identified and grouped into four categories, namely the dwelling characteristics, location features, neighborhood physical environment, and neighborhood social environment. These attributes are structured into hierarchy and the AHP model is employed to elicit the judgments through pairwise comparisons with the ratio scale. The relative importance of the housing attributes can be quantitatively estimated. Furthermore, the lifecycle/life-course approach is utilized as a tool to organize the demographic and socio-economic characteristics of the residents. Subsequently, the samples are divided into different groups on the basis of tenure type, marriage status, age, the presence of children, highest education level achieved, and household monthly income level. The mean category weights and the mean factor weights are calculated using the arithmetic mean of the overall sample and different groups.

It is found that housing preferences are diverse among the respondents, which are contributed to by the freedom of choice and increasing alternatives to choose from as results of the urban housing reform in the past 35 years. According to the overall mean category weights and mean factor weights, it is found that generally the location of the residence has dominant importance in consumers’ choice, followed by neighborhood physical environment and social environment, while the mean weight of dwelling characterizes is the lowest. Specifically, significant attributes include ‘sense of safety’, ‘medical facilities’, ‘education facilities’, ‘proximity to workplace’, ‘public transportation’ and ‘job opportunities’. More importantly, consumers with different demographic characteristics at different lifecycle stages show different preferences on housing attributes.

This study is a preliminary attempt in measuring housing preferences directly in the context of China. Instead of using observed actual choice data to estimate the monetary value of housing attributes, the AHP enables the estimation of the relative importance of both the tangible and intangible attributes simultaneously. The findings of this thesis provide information about the demand and preferences patterns of different groups of residents, which is useful both for future planning and for private developers’ strategy development. In addition, more studies with data from other cities are needed in order to draw valid conclusions about individuals’ housing preference patterns in China.