The Relationship between Income and House Prices on People's Consumption

This study aims to explore the factors that influence consumer spending, particularly focusing on the relationship between income levels and housing price fluctuations. Using Univariate regression analysis, the research draws on data samples from three major cities in China, covering the period from 2007 to 2024. According to the assumptions, three variables were selected to symbolize income levels (rate of increase in disposable income), house price volatility (second-hand house sales price index), and consumption expenditure (rate of growth in sales of all consumer retail goods). The study examines the connection between these factors by calculating R^2 and beta values. The findings indicate a clear and consistent connection between disposable income and consumption expenditure, whereas the influence of fluctuations in house prices on consumption expenditure does not reach statistical significance. Generally, the amount of money people earn has a greater influence on their spending habits compared to changes in housing prices.