Study On The Relationship Between Real Estate Credit And Real Estate Bubbles In China

"Sub-prime mortgage loan crisis"broke out in America, in the final analysis, was due to real estate's boom initiated by real estate credit. In China, bank credit is the main provider of funds, the development scale of bank credit will directly affect the real estate market in China.This article carries on the relationship between real estate credit and real estate bubble. Using of the date of 2000-2007, with the use of a combination of comparison analysis methods and qualitative and quantitative method, the article verified the theory of real estate's boom initiated by real estate credit.Firstly, it is described the relationship between real estate credit and real estate bubble, to reveal the methods of real estate's boom initiated by real estate credit. Based on it, look at the situation of real estate credit market and real estate market, real estate development loans has continued growth, credit market risk has been existed, there are correlation between the changes of real estate loan policy and the development of real estate market, etc. This can provide evidence for the relationship of real estate credit and real estate's boom.Secondly, combining with the measurement coefficients of the real estate bubble, we use the variables which are selected as real estate credit, the disposable income of urban residents, the money supply in circulation, etc. They are making multiple linear regression analysis with the measurement coefficients of the real estate bubbles. The results showed that real estate credit and the real estate bubbles have a high positive correlation with the real estate bubbles, although two other variables are introduced in the case. This can prove that the real estate credit is still the main reason of inducing the real estate bubbles. On the other side, we can see that the real estate loan policy has efficiently control our real estate market, and the policy changes has a correlation with the fluctuations of real estate market.Finally, based on this theoretical analysis and empirical results, view from the bank credit policy, the article puts forward the suggestions that further adjusting bank credit structures, strengthen risk management measures. This can prevent credit expansion arising from real estate real estate bubble.