Research On Financing Channels Of Real Estate Enterprises Of China

As one of the leading industries of national economy, real estate greatly bears on many aspects of a country's economy. Capital becomes the key factor affecting development of real estate with its programs on large scale, long operation period and high value. As we enter into the WTO, many industries are faced with great pressure of market competition from home and abroad, which has complicated the environment and widened financing channels. Real estate industry has to take into consideration the influence on industrial competition imposed by the factors such as the degree, ways, speed, cost, difficulty and risks in financing. To diversify the financing channels to receive adequate capital is of vital importance for the development of the industry itself and also plays a critical role in the national economy as a whole.This article first introduces the general theory of financing of modern enterprise by the cornerstone of financing theory—MM theory, and then summarizes the financing characteristics and influencing factors in real estate.Chapter three stresses on the present situation and existing problems in real estate financing, analyzes the national macro-adjustment policies in this respect and its influence on real estate industry which 'gives the conclusion that macro-adjustment policies imposed greater impact on the medium- and small-sized real estate companies; multi-financing framework gradually emerges as bank loans and advance fund of earnest money take larger proportion by analyzing capital sources; real estate industry is more dependent on banks and lacking in diversified financing channels by analyzing financing features and existing problems in real estate. Inferior company scale and quality is unfavorable for financing.Chapter four introduces financing ways, thoroughly elaborates and analyzes its classification, characteristics, merits and demerits of risks and suggestions and gives personal ideas and proposals for different financing ways.Chapter five emphasizes REITs and financing lease which are relatively new in real estate financing, generally introduces many other channels such as fund oversea, joint development, merging, project financing, entrusting loan, short-term financing bond and so on, and presents suitable channels for different companies.Chapter six studies financing strategy of real estate based on the first few chapters. It defines the laws and principles governing real estate financing, then analyzes different financing choices for companies with different project stages, for different projects and for different companies and then gives suggestion under each condition. Finally, it presents corresponding advice for each party, real estate industry in particular, to push forward their development in financing.In conclusion, real estate industry should consider its own financing ways according to its development level, classification of projects, project stages and so on. Faced with the trend of financing diversification, real estate should strengthen its own power, adjust thought pattern, improve project management and receive capital from wider channels.