Monetary Policy Impacts On Real Estate Price

In the previous years,the real estate's price had jumped,which gave rise to both government and academics's highly attention.There are many debates on the reason of real estate's price soar.This paper searches after the reason from the perspective of monetary policy,and discusses that improper monetary policy urged the real estate's price soar.The primary question I want to discuss is that improper monetary policy which was used to carry out tradiontional goals is the main reason of the real estate's price soar.On the foundation of theoretical researches,I also analyse the Japanese's real estate's bubble in the late 1980s,as well as Thailand and Taiwan real estate's bubbles in 1990s,then research the cause of real estate's price fluctuations in our country,and employ an empirical study on this issue.I research this question for two reasons:For the first,real estate involves so many industries that it should be paid more attention to when constitute monetary policy;For the second,with the development of capital market,virtual economy reacts more and more important to real economy.Therefore,the real estate market, which partly belongs to the virtual economy,should be paid more attention to when planning monetary policy.Thus,it is important to research this issue,which would do a deed of merit to the People's Bank of China.There are two new ideas in this paper:Firstly,I apply many classical Microeconomics principles to my research; Secondly,I use real estate's price rather than its Price Index to do empirical study, which differs from many other's methods.Under the theoretical and empirical study, I conclude that improper monetary policy is the main reason of real estate's price soar.In the end,I put forward some thoughts and recommendations about monetary policy in the following years.