The impacts of government educational policies on Hong Kong rental price

Abstract

This dissertation examines the impact of recent government educational policies on Hong Kong’s residential rental market, with a particular focus on student housing. In response to the 2023 Policy Address, which outlined plans to increase the quota for non-local students and expand scholarship offerings, this research investigates how these measures influence housing demand and rental prices across the city. The study employs a series of hedonic regression models to assess changes in rental prices following the policy announcement, considering proximity to universities, university rankings, and other locational and structural housing characteristics. Empirical results confirm that the policy has led to a statistically significant increase in city-wide rental prices, supporting the hypothesis that educational policy can exert pressure on housing markets. However, contrary to expectations, housing units located in close proximity to universities do not consistently command a rental premium. Furthermore, there is no conclusive evidence that proximity to higher-ranking universities results in higher rental values. These findings suggest that while policy-driven student inflows affect the overall rental market, the influence on specific submarkets such as university-adjacent areas are mediated by other factors, including competition from non-student renters, housing supply constraints, and population density. The study highlights the need for government intervention in expanding purpose-built student accommodation (PBSA), streamlining the conversion of commercial buildings or hotels into student housing, and improving transportation infrastructure to support decentralization. It also identifies critical areas for further research, including long-term policy effects, spatial analysis, and qualitative studies on student housing preferences. This dissertation contributes to the emerging body of literature on the intersection of higher education policy and urban housing dynamics, with practical implications for planners, policymakers, and private developers.