The Effect And Constancy Of The Restriction Policy

After the global financial crisis, China’s real estate market experienced a volume-price growth and a volume-price drop. The trade of the market highly fluctuated. In addition to the macro environment, the real estate market’s adjustment is closely related to the regulatory policies of the government. In April17,2010, the State Council issued the tenth article and demanded that according to the reality, local government can take temporary measures to impose restrictions on the purchase of commercial residential in a given period. Subsequently, the restriction policy has spread in46cities. Hangzhou launched in October,2010. However, it has not reached the same conclusion about whether the restriction policy is valid and whether its effect is continuous.This paper attempts to examine the interaction between the volume and price of the commercial housing in order to test whether the restriction policy works. In addition, this paper also focuses on the problem that whether the volume will increase again if the price falls, and then will push up the price once again. This paper takes Hangzhou as an example, It divides samples into the new commercial housing and the second-hand housing, respectively covering from January,2009to December,2012and from January,2008to December,2012. Firstly, using H-P filtering method, we can get an intuitive understanding on the effect of the policy. Secondly, this paper establishes VAR models to analyze the existence of the interaction between the volume and the price. Finally, this paper constructs impulse response functions to determine the time and the extent of the restriction policy.Conclusion of this study include:(1) whether in the new commercial housing market or in the second-hand housing market, there is interaction between the volume and the price so that the restriction policy works. In addition, in control of the regional economy, monetary policies and other relevant variables, the policy still works.(2) The volume affects the price, but the effect has limited and need to be strengthened by the long-term mechanism.(3) the effect of the restriction policy can only last for a short time. There need to launch a long-term mechanism.