Real Estate Price Formation Mechanism

The real estate industry plays a basic role in the national economy and leads the promotion by its strong association with many other industries. However, since China's real estate market has not been mature, the housing price is keeping increase overall in recent years, with parts overheated. There exists problems that seriously influenced the healthy development of the real estate, like irrational supply structure, rapid investment increase, excessive rise in price, and etc. Therefore, it is necessary to work over factors of the supply and demand during the process in real estate's pricing and factors that influenced China's housing price, then give advices referred to the policies in housing price's macroeconomic control.This paper starts with characters of the real estate and its market, pointing out that China's real estate belongs to imperfect competition for its stationary, heterogeneity and limitation. By reviewing the theories of production price mechanism and marketing supply-demand price mechanism, different composing factors of the housing price were analyzed. In the paper's most important part, referring to the supply-demand theory, supplying elasticity, production function in real estate, demanding elasticity and speculative demand in affecting the housing price were studied, meanwhile, the factors that affect the housing supply-demand were analyzed. Results show that factors, affected the price in the supply-demand, simultaneously decide the housing price until it becomes the equilibrium price when the supply and demand go to the equilibration. At the same time, the impact of the general pricing strategies for real estate property prices was analyzed. Secondly, specifically analyses characteristics of Chinese real estate market and some problems in the process of China's real estate price forming mechanism from price-income ratio, rental-housing price ratio and CPI synchronization rate etc several indicators, China's current real estate prices too high, deviated from its reasonable value interval. Through the analysis of the land policy of the government, the game between related interest groups, credit expansion, excess liquidity, and speculative demand expansion ect.,pointed out the influence of price forming mechanism. While China's real estate price forming mechanism, the government plays a leading role in price forming process, credit expansion and excess liquidity cause the speculative demand increase, and the corresponding security policy is not perfect, guide the real estate market supply and demand contradiction. Real estate price rise too large, far more than most household income level, so it cannot reflect the market realities. It puts forward relevant countermeasures macro-control on the Chinese real estate market in the last part of this paper mainly by adjusting the supply and demand, reform land policy and guarantee room system, increasing supply and plays tax and financial policies on the price adjustment effect.Through the research of fiscal and monetary policies apply integrated, changes of the real estate market demand and supply curve, finally the real estate market reach a balance between supply and demand condition...