Study On Problems Of Individual Housing Loan In China

This paper has explored the problems existed in the course of developing individual housing loan. The theoretical framework of research based on existed theories helps survey the course of individual housing loan from 1984 to 2001 and justifies the positive analyses as well as polices application. Then practical solutions are forwarded following careful probe of housing loan problems. Holding the methodology of integrating theory study and positive analyses, the paper focused on individual housing loan and managed to come up with conclusions as following.Consumption loans, whose development is subject to certain external conditions, are invented to propel economic growth, make commodities encashable and accelerate fund revolving. Measures shall be taken to better external environments, for instance, to avoid risks and expand sources of credit loans through converting assets into securities.Individual housing loan started in 1984 and developed vigorously since 1998 with the strong policy support, but it lagged behind the development of real estate and national economy. The study shows four major problems existed in individual housing loan. 1) Supply constraints of individual housing loan. Fund sources are highly dependent on commercial banks while large fund idles in the society; House accumulation fund contributed by the borrowers has not reached a reasonably big ratio of house purchase; And housing loan businesses of less assortments, smaller amount, and shorter terms, worsen the fund supply. 2) The potential demand for individual housing loan is not fully satisfied. Urbanization stimulates the demand for housing and housing loan, yet the loan amount supplied by commercial banks is rather small. 3) Irrational structure of supply and demand. Individual housing loan has propensity to less borrowers of higher income; borrowers of medium and low income, though they are majority, are refused for various reasons. 4) Excessive risks of individual housing loan business. The unreasonable composition and poor liquidity of credit fund magnifies risks of liquidity and interest rate; Individual credit information gap increases risks of credit; And undeveloped second-level market of real estate makes the disposal of mortgage more difficult.The lagging of individual housing loan has disadvantageous influences and offset its contributions to national economy. Study suggests the main constraints of individual housingloan: lower ability of accepting loans; defects of financial market; weak governmental support; unideal external environment. Consequently, the paper put forward solutions to improve individual housing loan: increase inhabitants' income and improve their ability to accept loans. Increase real monetary income and decrease housing prices and taxes as well. Innovate financial services and expand fund sources. Improve market system and shun credit risks. Guide housing consumption and better environment of credit loan.