Land Finance And Real Estate Price Correlation Studies

In recent years, China’s real estate prices continue to rise. In the progress of land bidding, auction and listing organized by local governments, the land transfer-fee records is refreshed repeatedly. Driven by cost, real estate prices keep soaring and cause ordinary people frustrated. On the other hand, accompanied by the booming real estate industry, violent demolition appears many times in some places and causes the community to complain.This paper chooses China’s real estate industry as the object of study, from the perspective of the "land finance", parsing the reasons of the high real estate prices. The paper uses a combination method of theoretical analysis and empirical test to explore the relevance of "land finance" and real estate prices. Based on empirical test results, the paper proposes targeted policies and proposals of gradually eliminating land finance and further optimization and improvement of financial reform.