Abstract To prevent housing prices from going up too fast, a major policy taken by the government is to increase the supply of land. However, in reality this policy has not been always effective. The author built a simple model about the determination of housing prices and land prices and analyzed the influence of government land supply on housing prices and land prices. The author holds that the effect of government regulation measures depends on specific market conditions, especially the extent of speculation and the sensitivity of expected housing prices to the change in land prices. In a housing market with a large extent of speculation, an increase in land supply may raise rather than lower housing prices
2011, Vol. 28 
