This paper uses China’s city level panel data to systematically examine the impact of housing-price to income ratio on population agglomeration. The conclusions are as follows: First, housing-price to income ratio can significantly promote population agglomeration, and it is an effective way to increase the city’s geographical attraction and population agglomeration. Second, this mechanism is most obvious in second-tier cities, and its impact on the eastern and northeastern regions is also more significant. Third, in cities with a ‘high housing-price to income ratio as well as high economic development’ character, the housing-price to income ratio mechanism will face the dilemma of failure, which shows that its impact on population agglomeration has a ‘bottleneck effect’, and it is more suitable for guiding the initial population diversion. Fourth, the pulling effect of the housing-price to income ratio on population agglomeration will increase over time. Meanwhile, it will also form a complementary effect and a positive feedback effect within the region. Therefore, increasing the housing-price to income ratio will have a positive and profound impact on China’s urban agglomeration construction during the ‘14th Five-Year Plan’ period.