For households as a socially composed micro-group, the rise of household housing liabilities can have a significant impact on household asset allocation. This paper utilises the latest data from the China Household Finance Survey (CHFS) 2019 to construct Probit and Tobit models to measure the actual impact of housing liabilities on household asset allocation, respectively. It is found that due to the mortgage repayment pressure brought about by rising housing liabilities, households will adjust their asset allocation accordingly, i.e., increase the allocation of risk-free assets represented by savings and reduce the allocation of risky assets represented by stocks and funds, which provides empirical reference for policy formulation to prevent household debt risk.

Yizhi Zhao, Jianhong Tao. Impact of Housing Liabilities on Household Asset Allocation. Academic Journal of Business & Management (2024) Vol. 6, Issue 2: 112-118. https://doi.org/10.25236/AJBM.2024.060217.

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