Credit Policy In Empirical Research, The Real Estate Market

Contents: In recent years, China's economy continuously maintained a rapid growth. China's real estate has rapidly development, and commercial houses'price has raised dramatically, growing to alarming rates, making many people disappointed to owning a house belonging to themselves. Highly raised house price will inevitably bring out a lot of problems deviated from the market's correct orientation and standards, which disturbed the market economy's development, and completely violated the Government's original intention of regulating the industry's development by the market's self-regulation. Highly raised house price is neither conducive to social stability, nor to the normal development of the real estate market. In this passive situation, the Government had to curb the industry's overheating bubble through a series of macro-control policies, in order to make the real estate market's development healthy and sustainable.At the first three month of 2009, the sales of commercial houses'area in Kunming is 788.7 thousand square meters, down 30.6% than last year, which is a continue decline starting from November 2007. The decline in sales will make the real estate enterprise's fund chain tense, companies of small-scale or poor managing will be merged, even go bankrupt, meanwhile commercial banks have also been implicated. Changes in credit policy can directly affect the real estate developers and buyers'funds, then affect the supply and demand of real estate market, finally affect the house price. Thus, it's an urgent problem to study the credit policy changes'impact on the real estate market in Kunming, which is the primary topic in studying how to make Kunming's real estate market developed healthy and sustainable. From 2003 to now, what's the impact of the present credit policies to the real estate market in Kunming? Can the newly issued policies successfully achieve their original intention of promoting the development of the real estate market stable? What's the reaction of the Kunming's real estate market before and after these policies? This paper, select Kunming as an example, made a research on the credit policy's impact to the real estate market, and proposed effective policy recommendations. In addition to the qualitative analysis of credit policies'effect to the real estate market in Kunming, this paper also made an analysis of the relationship between bank credit and real estate market. The data is selected from 1998 to 2007, and the analysis used econometric research methods.The empirical results showed that in Kunming bank loan had a non-significant impact to the real estate's price, and a significant impact to the real estate's investment, and a small impact to on real estate's sales. Financial institutions lending played an influential role in the sales price of commercial houses, however, the impact effect is not obvious.