Study On U.S. Housing Financial And Risk Prevention Mechanism

Housing finance for the needs of residents through the production of housing,consumer, housing (including rental) financing and settlement of financial servicesactivities in general, the real estate industry and the development of the nationaleconomy of a country plays an important role. Is generally believed that housingfinance is a high security financial business. Housing cumulative financial risk is verystrong, once the outbreak will be rapid expansion, a large area of financial crisis,threatening the safety of the entire financial system. The U.S. subprime mortgagecrisis is a real financial crisis caused by the housing finance itself, the rate of spreadof the crisis and the devastating beyond people’s expectations. The seriousconsequences of the subprime crisis so that people had to re-examine the risk ofhousing finance.In recent years, accompanied by the rapid development of China’s real estatemarket, housing finance (bank credit) at the same time continue to provide support,the risks faced by accumulation. We used to use the experience of the United States asa reference while developing our housing finance, and learn the methods and toolsfrom them. However, the outbreak of the U.S. subprime mortgage crisis made use tobe calm and look at our current housing finance risks faced and grim situation. Weneed to build a stable and effective mechanism based on China’s actual situation, sothat a society with equity and stability could be reality.Therefore, the systematic study of housing finance risk form of expression andformation mechanism, to reveal the great dangers of the housing finance risks ofsocial and economic development in China, to seek measures to guard against anddefuse the risk of housing finance, risk prevention mechanism for China’s housingfinance theory improve, and promote the healthy development of China’s real estatemarket, to meet the the housing consumer demand of the general population, to protect the safety of the financial system, are of great significance.In this paper, the U.S. housing finance system for the study, the study of housingfinance risk and its prevention, and hope to inspire the Chinese housing financial riskprevention. First of all, the papers will be combing the risk of housing finance theory;Second, review the development of housing finance in the United States, analyzes thechange and innovation; Once again, the U.S. housing finance system, the causes ofrisk and risk supervision, and be described in the "subprime crisis"; the researchersthen U.S. housing financial risk prevention mechanisms and their advantages anddisadvantages; Finally, at the conclusion on the basis of experience, talk about how toimprove China’s housing finance risk prevention mechanism. For the content of thestudy to draw some meaningful conclusions.Housing finance and housing financial risks related theoretical basis. Housingfinance concept involves housing finance, housing finance system, housing, financialinstruments, the housing finance market. The financial risk is the production ofhousing, consumer, housing (including rental) financing and settlement of financialservices activities of financial institutions in the housing finance market, due to avariety of uncertainties, risks arising from the gain or the risk of profit or loss.Including credit risk, liquidity risk, systemic risk, interest rate risk, exchange rate risk,the risk of inflation and housing finance other risks. The housing financial risk byasset price volatility theory, financial instability hypothesis, information economicsand monetarist theory to explain the formation mechanism of the housing financerisk.The development of housing finance in the United States has gone through fourhistorical evolution of the exploratory stage before the1930s,1930s to1960s, thestage of institutionalization, from the1970s to the1980s, the Securities and20thcentury1990s deepen the perfect stage.1950s to the mid-1960s, in order to avoidinterest rate risk and liquidity risk, the federal government for housing finance reformand innovation, the establishment of a housing finance secondary market, and thedevelopment of mortgage-backed securities products, mortgage securitization housing finance market in the United States to establish a more comprehensive insurance,surety and regulatory systems, so that housing finance a to collaborative healthydevelopment of the market and the secondary market. At the same time, the UnitedStates introduced a housing security policy, public housing policy, tax relief policiesand mortgage policies three housing finance policy.U.S. housing finance system has been developed based on mortgage-backedsecurities based housing finance system, has a highly decentralized andmulti-polarization characteristics. The subprime mortgage crisis resulted in nearlythree decades, the U.S. real estate market bubble finally burst, broke out in recentdecades, the most serious real estate crisis. For U.S. housing financial risk causes ofmacroeconomic volatility in the capital markets caused by systemic financial risk, andthe housing finance market place undue reliance on self-regulation, has long looseregulatory regime is not unrelated. In order to suppress the spread of the subprimemortgage crisis, stabilize the housing finance market, the U.S. government issued aseries of housing finance policy. The problem of the housing finance system in theUnited States government credit guarantee of the federal government’s debt burdenhas been increasing, and the potential risks facing decline in credit ratings andsovereign debt crisis.The subprime mortgage crisis is a typical case of the U.S. housing finance risk.U.S. housing finance, lack of supervision is the root cause is the direct cause of therise in interest rates and the real estate bubble burst, the illegal operations of financialinstitutions is the fuse of the crisis, asset securitization transmission and amplificationof the subprime mortgage crisis. After the outbreak of the subprime mortgage crisis,subprime mortgage crisis and challenges, the Fed and the Treasury have been taken aseries of measures. Housing policy, the Federal Housing Administration launched arefinancing plan, restructuring hope alliance to increase mortgage financing. Inmonetary policy, through traditional monetary financial instruments and liquiditymanagement tools to intervene. On fiscal policy, adopted a series of proactive fiscalpolicy to stimulate effective social demand. Finally, by taking over part of the brink of bankruptcy institutions, risk of direct intervention in the housing finance system.U.S. mortgage securitization risk prevention mechanism framework includesgovernment agencies assurance framework and risk prevention framework. Thesubprime mortgage crisis has exposed the housing finance market regulation issuesinclude: the U.S. housing bulls regulatory inefficient vacuum regulation of lendinginstitutions liquidity and capital adequacy ratio is not sufficient, the securitizedproducts over derivative serious, liquidity can not be fully to meet the needs ofinvestors, banks and rating agencies to relax the risk is amplified. Housing financeafter the subprime mortgage crisis a series of reforms proposed to further strengthenthe supervision of the housing finance market, and within a reasonable range ofgovernment support for the privatization of enterprises, enhance the efficiency ofresource allocation housing finance market spontaneous, concentrated in the housingfinancial supervision of the secondary market, institutional planning and theprotection of consumer rights. In addition, to attract more issuers of mortgage-backedsecurities, give full play to the role of private capital.The Chinese Housing Finance experienced from scratch, to the relativelycomplete development process, especially in recent years as the domestic real estatemarket continued to rise and rapid development. At present, China’s housing financeimperfect market system, financing channels, product category, market-orientedregulatory means, imperfect laws and regulations. China’s housing finance to preventrisk should start from the structure of financial markets, improve the housing of afinancial market to cultivate secondary market for housing finance, financialinstitutions to enhance the management level, the rich housing credit sources of funds,improve housing security system and improve the housing financial regulations,strengthen the supervision of the housing finance market, and to achieve sustainabledevelopment and prosperity of the housing finance market.