| Abstract: Real estate is one of the basic means of livelihood for human beings to live and to develop; also it is a significant index of a country's economic development and living standard. The real estate bubble an economic phenomenon which usually happens in the developing countries with a large population and comparatively a few land when they are at a stage of high-speed economy developing. Once occurred, real estate bubble would bring severe consequences to the economic and social life of a country. Thus, the importance of real estate bubble prevention is clear.Since the recovery in 1998, the domestic real estate industry has achieved great progress and success. However, there still have been many problems such as the extortionate house price, the excessive land supply, the high housing vacancy rate, the unreasonable structure, and the overheated investment growth, etc. These issues have triggered off the argumentation on whether there is bubble in China's real estate market. Chengdu, as one of the most important cities in southwest and a main economic center in west, has got much attention.Based on the situation mentioned above, this essay first did some theoretical study taking the research findings home and abroad as references; then it collected the latest data to analyze that if there was bubble in Chengdu real estate industry during the year of 1997 to 2006 comprehensively with the qualitative and quantitative analysis methods; finally it offered some advices on how to prevent the industry from bubble with a critical attitude.To put it more specifically, this essay first introduced the concept of"bubble"to us. It expounded the definition, classification, carriers, causes and economic effects of real estate bubble. It analyzed how the bubble formed, its operational mechanism and the pattern of accumulating and releasing. Then it stated the interactive relationships among the housing price, the market supply, demand and expectation on the foundation of basic theories of housing price study. It analyzed the connection between the housing price and the land price; also it clarified the differences between the knockdown price, the market price and the theoretical price. Since all the concepts have been defined cleared, this essay then did a quantitative analysis on real estate bubble. It suggested a method of evaluating real estate bubble according to the theories and approaches in market price and explained how to carry it out by taking Chengdu as an example. It estimated the bubble in Chegndu's real estate market using the demand factors as well as calculated its bubble modulus BEM time-series. On the basis of analysis from different angles, it finally came to a conclusion that there did is a trend of bubble in Chengdu's real estate market and put forward some suggestions on risk prevention.This essay is written hoping to draw enough attention on the phenomenon of real estate bubble and offer some references in poly making in housing industry. |
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