A Study On The Relationship Between China’s Real Estate Credit And The Real Estate Bubble

The housing distribution reform in1998made China’s estate into rapid development, and at the same time, the high price of the real estate caused universal concern. In china, bank credit provides the most funds for the real estate development, so the scale of bank credit will directly affect the real estate market in China.How do the bank credit scale and the real China’s estate price affect each other, whether there is real estate bubbles at present in China, whether does the real estate bubbles have relationship with the estate credit scale, these questions worth our further research. Based on the three questions for clues, this paper analyzes them from theoretical and empirical aspects, and put forward the suggestions to solve these problems.The second chapter of this paper analyzes the development and present situation of China’s real estate market and bank credit. The housing distribution reform in1998made China’s estate into rapid development, and at the same time, the bank credit scale grew rapidly, bank credit became the main source of the real estate industry funds in our country. In this context, this paper introduces the first question-How do the bank credit scale and the real China’s estate price affect each other.The third chapter in this paper researches how do the bank credit and the real estate price affect each other which respectively analyzes from two aspects of theory and empirical, and it is a specific answer to the second chapter’s question. Through the granger causality test, it draws a conclusion that our bank credit and real estate price exist bidirectional causality. That is to say, the rise of the real estate price leads to the expansion of the bank credit, and the expansion of the bank credit can also lead to the rise of real estate price. They promote each other, and it may lead to generation of real estate bubble. The Johansen Co-integration Test shows that financial institutions credit scale positively influence the price of real estate in long term. The error correction model and impulse response analysis show that change of real estate price doesn’t have significant positively influence on the loan scale of financial institution in short term, and the loan balance of financial institution has insignificant positive influence on the real estate price in short time. That is to say, the influence that the change of real estate price has to the bank credit scale is a long-term process, similarly, the influence that the bank credit scale has to the estate price is also a long-term process.The fourth chapter introduces the relevant theories of real estate bubble, summarizes the definition of real estate bubble, and analyzes the cause of real estate bubble. This chapter lays the groundwork for the analysis of the fifth chapter and the sixth chapter.To the question whether there is a real estate bubble at present in our country, the fifth chapter introduces representative index to measure the real estate bubble from different angles, and adopts the geometric method to combine the real estate bubble measure coefficient, it measures the bubbles in our real estate industry and draws the conclusion:there isn’t a continuous real estate bubble; in some years, real estate bubble exists, and in the other years, real estate bubble doesn’t exist, the real estate bubble need to cause some attention.Through empirical method the sixth chapter researches the relationship between the real estate bubble and the real estate loan scale. The Johansen co-integration test and granger causality test show that:the relationship between the real estate bubble and the real estate scale isn’t significant, they don’t exist bidirectional causality, expansion of real estate bubble will lead to expansion of the real estate credit scale, but expansion of the real estate credit scale won’t necessary lead to expansion of real estate bubble. One explanation for this is:real estate bubble doesn’t just depend on the real estate price. Real estate bubble measure coefficient is made up of different measure index, and it analyzes comprehensively the size of real estate bubble in our country, so the cause of its formation is the more complex, we can’t explain the real estate bubble only by the expansion of real estate credit.On the basis of the previous analysis, this paper put forward the advice for controlling the price of our country’s real estate and preventing the formation of real estate bubble. From the macro structure of our country, we’d better change the supply and demand relation of the real estate market at present in our country, broaden the real estate financing channels, and avoid financial risks.The innovation of this paper mainly includes the following:Firstly, this paper introduces representative index to measure the real estate bubble from different angles, adopts the geometric method to combine the real estate bubble measure coefficient, and measures the bubbles in our real estate industry.Secondly, on the basis of the previous analysis, through empirical method this paper researches the relationship between the real estate bubble and the real estate loan scale.The deficiencies of this paper mainly includes the following:Firstly, in the process of measuring the real estate bubble, due to lack of data of some index, so this paper abandons some index which doesn’t have data when combine the real estate bubble measure coefficient.Secondly, when this paper researches the relationship between the real estate bubble and the real estate loan scale through empirical method the sixth chapter, due to too many index which the real estate bubble measure coefficient contains, and the relevant data isn’t founded, so we only adopt1998-2010annul data, sample observation is a little less.