A Research Of Real Estate Speculation On The Basis Of Behavioral Economics

Having the real estate marketing in China as its background, this article is devoted to the research on the speculation of the real estate from the aspects of the speculators' psychology and behavior. The major points are its appearance, development as well as abnormal real estate speculations. Simultaneously, a brief generalization will be made for the features of domestic real estate speculations. At the end, a conclusion will be made, proposing suggestions for effective control and management in this field.Generally, the present article will be divided into six major chapters, whose major points are shown as follows:First chapter is the introduction. Real estate speculation has attracted much attention in China. The development of behavioral economics greatly deepened the understanding of speculations. Accordingly, scholars abroad turned their effort to micro level of speculators' psychology and behaviors.The second chapter is a survey of real estate speculations. Usually, the properties of capital and features of market serve as the basis for real estate speculations. The appearance of real estate speculation could be attributed both to the macro and micro approach, because it is vague, complex and diverse in its nature, ways of operation as well as its forms. In this sense, theories on behavioral investment contributed a lot to the perfection of these theories.The third chapter is an illustration of the underling psychology and factors influencing the speculative activities. Speculations in real estate agree in nature with the general human activities, in which various psychological states of speculators may greatly influence their decisions. In this sense, real estate speculations are activities of many procedures, from basic understanding to the final decisions. Collective speculations may differ a lot from that of individual ones. As a result, unique features may arise, such as positive and negative feedbacks and the peculiar "Herd Effect".The fourth chapter discusses the influence made by irrational decisions. These irrational speculations may have great impact on participants' psychology and behavior, the price and the efficiency of business.The fifth chapter is a demonstration of the cases of real estate speculations in domestic market. A rather thorough illustration of speculative features is obtained through analysis of group speculations in Wenzhou.The last chapter is the conclusion and constructive suggestions. A summary of speculations is made on the basis of the close examination of speculators' psychological states, behavior and the possible influences in the market. Furthermore, constructive suggestions are proposed in terms of the establishment of a sound real estate system, the self-discipline of speculator and government interference.