Chinese Real Estate Industry And National Economic Growth, The Interaction Between Research,

With the rapid development of economy, the real estate industry has already played an important role in economy in China. At the same time, the prices of real estate rise rapidly too. The house prices decline in 2008 because of the financial crisis, but go up again in 2009 with the economic recovery. Fluctuations in house prices have already become the focus of many people. The "Dubai crisis" in 2009 attracts more people's attention to the real estate industry in our country.Though there are many researches about the interaction between the real estate industry and economic growth at home and abroad, there is relatively rare paper based on the panel model, in particular the panel cointegration and dynamic panel analysis. What's more, most researches at home and abroad selected national data rather than regional data to analyze the real estate industry. The real estate market varies widely between cities because of China's vast territory meanwhile the real estate industry has its own significant regional characteristic. All these makes selecting regional data particular practical significant for research.Based on a large number of relative references, this paper analyzes and summarizes the interaction between the real estate industry and economic growth, the importance of economic growth, the theory about modern economic growth and the development of the real estate from theoretical view. This paper also describes respective characteristics of China's real estate industry and economic growth on the basis of the current situation.On positive aspects, this paper selects nearly a decade data about the real estate sales price and real estate sales area, as well as China's GDP of China's four municipalities - Beijing, Shanghai, Tianjin, and Chongqing where's real estate industry seems more mature. By using the panel cointegration tests, establishing error-correction model and dynamic panel model, this paper analyzes the interaction between China's real estate industry and economic growth, and gets the following conclusions:1) China's economic growth shows a long-term stable relationship with the real estate industry development, and economic fluctuations affects housing price significantly, the negative effects of which exert an obvious positive impact on housing sales.2) As an investment asset, the real estate plays more important role, which shows a"positive feedback transaction"phenomenon: the higher of prices, the more of transactions. 3) Compared with housing price, housing sales, which are mainly affected by supply shock, show more volatility. And its long-term dynamic adjustment is affected by economic growth and housing prices.Based on these conclusions, this paper considers stabilizing real estate prices very important and gives some advices about how to stabilize real estate prices.