The Impact Of Chinese Bank Lending Scale On The Real Estate Price Fluctuation

Since the real estate industry rose in China, it was gradually significant in promoting Chinese economic and had become one of the pillar industries of economy. From 1980, China began to implement the system of urban land exploitation and housing reform, the real estate began to recovery and real estate investment grew. From 1997, the bank had been allowed to grant mortgage loans, real estate transactions became more active. From 2003, the housing prices increased sharply, real estate investment and sales increased, China had implemented a number of macro-control measures to make the real estate market stable and healthy. In China,60% of the real estate market funds come from bank loans, so the country introduces many credit control policies to guide the real estate development, such as the regulation of housing payment and loan interest rates, the limitation of the amount of real estate development loan funds and other corporate credit policy. This paper studies the affect of bank credit to the price fluctuations from a theoretical and empirical analysis, with a view to promote effective policy recommendations to regulate the real estate credit and real estate development.This paper is divided into three parts. First part includes the first two chapters. Analyzing the factors affecting prices theoretically, bank credit is one of them. Bank credit affects prices by liquidity, real interest rates and the expected impact of the residents'behavior of the real estate market participants, bank credit affects housing supply and demand, thereby affecting the price.The second part is the main part which includes Chapters 3 and 4, describe the real estate developing history began with 1978 and do empirical analysis of the status quo. In Chapter 3, the Chinese real estate development process is divided into five stages, introduce the policy of each stage and give a brief description of each situation. From 1998 to 2010, the government implements macro-control three times, focusing on various important display of the real estate credit policies, and then using the data to describe the status of the real estate market and support from bank loan, find the real estate is in the prosperity and housing prices continued to rise.In Chapter 4, author selects 1998-2011 quarterly data of the size of bank credit, housing prices, economic growth and interest rates to do empirical test, find as the bank credit scale expand 1%, the housing price rise 0.6167%.The last part is Chapter 5, author brings up the conclusions and proposed relevant policy recommendations. It comes up that control the size of credit and structure can guide the participants'behavior thereby affecting the price. Proposing the following suggests:adjust the total and structure of real estate guide the real estate investment; give the clear definition of the different nature of the demand, and implement the differentiated loan system strictly; implement the stable monetary policy to guide the real estate market, reduce the stimulation to the real estate market; strengthen the real estate credit regulation, and control the credit procedures strictly.