An Empirical Research On Financial Distress Prediction Of The Listed Real Estate Corporations In China

The real estate industry is a pillar industry of national economy in our country. And it played an important role in national economy and social development. Although earned a lot of benefits, the real estate industry was facing a great risk at the same time. After 2007, the real estate industry had gone to a period of adjustment. And the financial risk had increased rapidly. So many real estate companies had been dropped out of the market gradually. Especially after the outbreak of the credit crisis in the USA, our government and financial institutions had enhanced the regulation of the real estate industry. While the financial safety and success is an important key to a company's Survival and development, so the research on the financial crisis early warning is very important and having practical significance.Based on the current situation of the real estate in China, used the early warning theory, combined factor analysis with logistic regression analysis, adopted the empirical research methods, this thesis had construct financial early warning model about the real estate in China. The main body was divided into four parts: the first part was an overview of the real estate market's financial early warning knowledge. Firstly a briefly introduction of the financial early warning theory; then an analysis of the reasons why the financial crisis arising from; and elaborated on the impact what the non-financial factors bringing into the financial situation; in the end of this part I gave the empirical research methods system. The second part was the options of the samples and data. I bring forward the hypothesis of this study and introduced the system variables in this research. The third part was the significant analysis on the selected samples, then erased the significantly higher variable, therefore the rest of the variables had been leaved for the factor analysis, so the main factor had been selected, these factors had been used in the Logistic regression model. In the end, the financial early warning model of the real estate industry in China had been build. The fourth part was the testing of this model, finding the conclusions of this research, and analyzing the limitations of the model.The results show that the early-warning variables basically reflected the operation and management status of a listed company. The early-warning model can forecast the financial crisis in the China's real estate and the accuracy is up to 92%, it can better predict the financial situation of the real estate industry. The changes of solvency variables has the most affected to the financial situation in the real estate industry, besides the assets and liabilities ratio and equity ratio are the dominant factor in solvency variables. These can indicate that the real estate enterprises should pay attention to its long-term solvency, check its Capital structure frequently and make sure they are in a normal and health state. In aspect of the non-financial variables, the audit opinion variables has a certain degree of predictability about the real estate industry; but the equity structure variables has little effect on the real estate.