The Housing Price Model Based On The Speculative Demand And Research

The housing price in China is one of the most popular topics in recent years. Now the housing price is far above the average of people's earning. More and more people who have low and middle incomings can't afford the house price, meanwhile the house price is still keeping increasing. The traditional supply and demand models had some limitation in analyzing the real-estate market. The requirements which improve the price is not from normal consumer, but mainly from the speculative demand. Real-estate is not a normal durable consumable. It not only brings the utility which support a living place but also brings the profit as a kind of an asset.This thesis is trying to explain the reason of the highly increase of real-estate price base on the research of the speculative demand, and build a house price model added the expected parameters. Firstly this paper analyzed the limitation of traditional supply and demand models on analyzing real-estate market, then introduced the classic expectation theory, and builds a housing price model based on the speculative demand. It analyzes the influencing factors of speculative demand. In the process of building the model, we considered the factors that affect the need and demand in the market, and build a equation. We then gave the illustration of the equation, and this is the most important and valued part of this thesis. After that we used our theoretic results to illustrate the connection between real estate markets, bank and real-estate renting market. And we used the theory to give explanation of some phenomena of the Sub-prime mortgage crises and also some event related to this market in China. In the end, based on the analysis of this model, this paper gives some suggestions mainly on how to restrain the speculative demand, And the government should give enough assistance to the low-income people.