| In the 21st century, the significant increase in housing price leads to the weakening of housing affordability of families in cities, especially the low income families. Better theories and methods are needed for systematic research on housing affordability.The housing affordability is a highly concerned research topic. Based on the summary of a number of housing affordability literatures, this paper chooses three approaches and one index to research the housing affordability of Hangzhou. The traditional static price-to-income ratio is a widespread used approach which has some logical flaws. With this approach, we get a negative result shows that the Hangzhou city households are in a serious housing affordability state. But based on the two more scientific approaches: the dynamic price-to-income ratio approach and the newly-developed residual income approach, this study denies that the housing affordability conditions have significantly deteriorated in Hangzhou. Housing affordability index (HAI) is another index for assessing the whole housing affordability condition. Taking the income growth of household into account, the HAI of Hangzhou is not lower than 100, and the housing market of Hangzhou is an affordable market. International comparison shows the same results. The enlargement of urban household income difference and the imbalance of housing price structure are two factors that have led to this housing affordability problem of Hangzhou. |
