Housing Price Bubble In Zhejiang And Risk Management Of Real Estate

Since the latter half of the 1980s, Japan's economy has experienced the emergence, expansion, and bursting of a bubble economy. During the subsequent period of the bursting of the bubble from the early 1990s, Japan experienced a plummet in asset prices, the accumulation of huge nonperforming assets and resulting difficulties faced by financial institutions, and a prolonged recession. We also have seen this type of speculation in the cities of Asia, during the recent Asian financial crisis. With present evidence of strong recent gains in house price that stretch across substantial portions of Zhejiang, accompanied by strong housing construction and the promoting policy of china government, we debate it have been in the real estate price bubble. There are different opinions concerning these problems.The paper are trying to catch up, and searching for the answers. It focuses the studies of micro-mechanism, framework and motheds of measurement about bubble. My innovations on the real estate bubble inthis paper consists of three parts as follows:Firstly, I make a case study on the status quo of Zhejiang's real estate industry by land supplying, constrution development and market exchanging. Then we analyze the boolclets of real estate industry in Zhejiang with method of principal component analysis, compared with the Nation and Ningbo city. What's more, we show a phenomenal order of periodic fluctuation in real estate industry.Secondly, we estimate the current levels of price bubble in Zhejiang from several empirical models of property prices that combines fundamental variables with speculative bubbles. The price of real estate coordinated with the macro-economy in Zhejiang, however it has high price bubble in partially. I analyze the reasons of the rapid-promoted price in property of Zhejiang Province.Thirdly, I discuss ten potential risks in real estate industry, with the market- mechanism, and providing six avenues about controlling the bursting of price bubble. Then I analyze the establishment of macro adjustment and policy choice of Zhejiang's real estate industry in detail.