Research On Financial Underpinning For The Industry Of Real Estate In Booming Cities In Jiangsu

In the report of "China50Interactive" issued by Jones Lang LaSalle in March,2012, six cities in Jiangsu Province were in the list:Nanjing, Suzhou, Wuxi, Changzhou, Nantong and Xuzhou."Booming cities" are defined as cities with comparatively prosperous economy, rapid development and enormous potential. They themselves have established more refined modern city system and industrial system. They are opening or have further opened their market. Meanwhile, these cities often present unique geographic advantage or enjoy national supportive policy. Two main reasons for taking booming cities in Jiangsu as research subject lie in the broad prospects of real estate in these areas and their highly dependence on the industry of real estate. Its unhealthy and disorderly development will severely restrict the economic growth of these areas.Finance places a significant role in the development of the industry of real estate, and current situation reveals so. In order to healthily develop the industry of real estate in booming cities in Jiangsu, this article proposes specific policy suggestions from the perspective of financial underpinning.By analyzing the influence and importance of real estate finance, this article first studied its mechanism of effect on the industry of real estate and the operating models of real estate financial market within the theoretical framework of real estate finance. This article next investigated the industry of real estate in booming cities in Jiangsu and identified the problems during its development process in these areas, based on which financial underpinning was further examined. It was showed that real estate development lacks stable fund supply, sufficient financing channels, full-fledged legal system of real estate finance, advanced credit information system of real estate loans, and so forth. Last but not least, this article put forward five financial underpinning strategies for the problems discussed and for the better development of the industry of real estate in booming cities in Jiangsu:first, to implement differentiate credit policy to optimize the demand structure of real estate; second, to scale up the intervention of real estate financial market; moreover, to guide public’s positive consumption ideas; in addition, to strengthen the supervision and management of real estate financial market; and finally, to make improvements and innovations in micro real estate financial business.