China Real Estate Bubble, Discriminant Analysis And Suggestions

To confirm whether the real estate market has Bubble, it has to be confirmed that what is Bubble. Generally speaking, Bubble means real estate price deviates from its basic price, keeping rapid increasing, and it is the result of both the inner factor and outer factor of the real estate market, and it is the part of the difference between market price and the reasonable price decided by market base. There are many indices to check whether real state market Bubble exists, which includes: Deviation Degree between actual price and theoretical price, vacancy rate, the rate of price and income and etc.Theoretically, the best measurement index is the Deviation Degree between actual price and theoretical price, which means the bigger deviation between the two price levels, the more probability there exist Bubble. Based on the above reason, this paper deducts whether the real estate market Bubble exists by checking the Deviation Degree, which is decided by the difference between dummy part of the real estate price and real asset basic price.The creative part of this paper is that from the government point of view, based on quality analysis and economics analysis of the real estate Bubble, introduces the knowledge of Econometrics and Statistics, and makes quantitative analysis to the Bubble. The meaning is that there is strong economics theory support, when the government makes Macro Economics control decisions. Also another feature of this paper is that through the phenomenon of rapidly increasing real estate price, it could be concluded that the real estate market has the nature of partial hot, and it is now the beginning part of the Bubble.The new statement of this paper is in the Control Policy Suggestion Part, which points out that we have to focus on not only controlling demand and supply of lands, but also checking the needs of real estate market, defending fake and speculated needs, and protecting real living needs. After the major suggestion part became government documents reported to the Ministry of Commerce of the People's Republic of China, the State Department came out with a new round of Macro control policies very soon, which changed the old methods of lands supply in the past, and the new policies adopt three measurements to stable the real estate market, including lands supply, control speculation, and decrease elasticity needs. As a result, the conclusion of this paper deducted by the analysis procedure is correct, and the paper is expanded on the base of a government institutional research paper, it does not deviate from the macro environment of social economics development; also the policy suggestions make a very important part of the Macro control of the government, and there is no doubt of its importance and its reality meaning.The paper has five parts. The first part is the general statements. It mainly states the background and meaning of this research, and introduces the structure of the paper. The second part is the theoretical research works, which mainly studies domestic and over sea's research papers and analysis methodologies on the subject, and summarized the related domestic arguments on judging real estate market Bubble. The third part investigates the formation and expands of the real estate market Bubble from economics point of view, and then deducts Bubble measurements, which includes asset Bubble degree and asset theoretical value. The fourth part points out that the abnormal real estate expand makes Bubble Crisis arisen, and then explains that access demand is the fundamental basis of the real estate Bubble, and also analyses the factors which leads to the real estate market Bubble and its negative effects, and makes the judgment of the existence of the real estate Bubble, at the last, it comes to the conclusion that we indeed have so called partial over-heated phenomenon in the real estate market, which is the primary status of the real estate market Bubble. The fifth part is the policy principal, over-sea's experience and policy suggestions. The last parties the bibliography and acknowledgements.