| Considered the close relations between financial market and housing market, this paper explores the influence of interest rates on housing prices in China. The thesis firstly reviews effect factors about housing prices, especially the interest rate, from native and foreign scholars. And then from the perspective of demand and supply of the housing market, make a detailed analysis of the mechanism that interest rates affect housing prices. It is concluded that interest rates simultaneously reverse acting on the housing supply and demand whose relative elasticities decide the ultimate housing prices. After reviewing Chinese housing market's development, and analyzing the reasons and impacts of high prices, compare the effect of interest rates policy between US and China and find that in US is better.Select the five different-period benchmark interest rates for deposits and loans, housing price index and land price index, build VAR model and explore interest rates'effect on housing prices empirically by using the methods of unit root, cointegration, Granger causality, impulse response and variance decomposition. Find that China's housing prices are less sensitive to interest rates and show that China's interest rate policy has a weak effect on the housing price. Interest rates for deposits and loans have positive effects on housing prices in the short term,but have negative impacts in the long term. Interest rates can't Granger cause housing prices in the near term, but can affect them in the long run. In addition, the impact of lending rates and short-term rates on housing prices are bigger than that of deposit rates and long-term rates.Finally, the paper analyzes the reasons of the weak effect of interest rates regulation in China such as low degree of marketization of interest rates, obstructed interest rate transmission mechanism and real estate operating mechanism, and gives some suggestions respectively to improve the real estate rate-control results. |
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