China's Real Estate Financing Constraints And Countermeasures

Since real estate is one of China's pillar industries, also one of capital-intensive industries, effectively solving the problem of its financing becomes necessary to promote its healthy development. The diversification of finance model of real estate in developed countries provides funds for the development of real estate enterprises. While in China, the financial system needs to be further reformed and the real estate financing system needs to be completed. In this paper, the writer analyses various constraints of financing of China's real estate enterprises and proposes means of financing reform and financing channels.The core of this paper includes three parts: firstly, the paper analyzes the status of various financing constraints of real estate enterprises, including financing environmental constraints, industrial constraints and their interval bound. Based on the analysis, diversified financing is necessary and urgent. Secondly, considering the virtual facts of china, this paper introduced two tpyes of financing: REITs and Strategic alliance. The paper introduced the operation of REITs and the difference from the China's real estate investment funds. Then it points out the good environment for the execution of REITs and the foundation of REITs operating system of China. Further more, the paper analysis small and medium-sized real estate enterprises to introduce the characteristics and contribute of alliance strategy on the financing approach. And next, the paper made several proposals for small and medium-sized enterprises to put forward their financing alliance strategy. The last but not the least, the paper proposes some advice on the rational choice of financing portfolio and combination. The combination of different sources of funding allocation lead to different capital structure, capital costs, conflict of interest and financial risk, which affecting the company's development. This paper analyzes the impact of corporate finance real estate portfolio to point out that the cost factor is the most important in the impacts of decision-making of real estate financing portfolio. Further more, the paper has built up financing costs econometric model based on the Wantong example to make the lowest cost, which can provide financing portfolio decision-making for enterprises. Considering the limitations of financing costs econometric model, the paper constructed sequence with superior model which compositely considers financing costs, financing deadline and financing risks, etc. At the last part of the paper, different financing package have been arranged by the evaluation scores to select the optimal one for the financing portfolio decision-making of real estate enterprises.At last, the paper concludes the research results, analysis the existing inadequacy and future study direction.