The Research On The Factors Of The Real Estate Prices

The real estate industry is one of the most important industries in China. Itrelates to the healthy development of the national economy and people’s lives. Sinceour country canceled welfare devoting system in1998, the real estate market hasdeveloped rapidly, and the real estate prices have also become higher and higher. Therise of the real estate prices is larger than other industries’. The rapid increase of thereal estate prices has become the focus attention of the whole society. Thegovernment has issued a series of adjustment and control policies in order to controland stabilize the price. But the effect is not good. Under this background, the paper isexpected to find out the cause for the price rising rapidly through analysis of thefactors of the real estate prices. Than we can take corresponding control measures topromote the healthy and stable development of the real estate market.Based on the research results and current situation of China’s real estate prices,the paper makes qualitative and quantitative analysis of the factors of real estateprices. Then it makes the Grey Relational Analysis using the annual data from2000to2010, and finds the Gray relational grade between the land exchange price index, CPI,lease price index and housing sales price index is bigger than the grade between theM2, interest rates, prosperity index, GDP, per capita disposable income and housingsales price. It means the rising real estate price is not due to the real estate marketwhose demand exceeds supply, but to the uncompetitive market making by thegovernment-the bank-the real estate business. So if we don’t pay attention to theuncompetitive market, we will not understand the cause of the paradox of the macroregulation. The paper also uses VAR model and impulse response function to analysisthe dynamic relationship between the land exchange price index, CPI, lease priceindex and housing sales price index. And find that the changes of the real estate priceshave lag time of the changes of these factors, but in the long-term, the changes havesexual response. Finally based on the qualitative and quantitative analysis, the paperprovides suggestions on the land, the price level, lease market and real estate marketmechanism to control the basis of rising house prices.