The Association Study Of Buyers’ Confidence And Housing Price

There are many irrational phenomena in real estate market in China, but traditional economic theory can’t explain these phenomena reasonably. With the development of behavioral economics, many new theories provide theoretical basis for explaining irrational phenomena in real estate market. In behavioral economics, confidence is one of the irrational factors which influence the behavior of people. Thus, the buyers’ confidence in real estate market might influence the market. This paper confirms that the buyers’ confidence and housing price have relations through theoretical analysis and empirical research.First of all, supply&demand theory on commercial housing market and behavioral deviation theory in behavioral economics were used to analyze the influence of buyers’ confidence on housing price. Buyers’ confidence will influence the purchase of buyers, which has two aspects. The first one is that optimistic state will enhance the purchase demands, the other one is that pessimistic state will reduce buyers’ needs. According to the supply&demand theory on commercial housing market, in market equilibrium and market disequilibrium states, the changes caused by confidence will lead to the changes of housing price. It is deducted that optimistic state will enhance housing price, preesmistic state of confidence will reduce the housing price.Secondly, refer to the system and preparation method of consumer confidence index, buyer confidence index system has been constructed by these four indicators: economic development situation, policy factor, family income and willingness to purchase, the Internet search data was used to compile buyer confidence index. The compilation steps are divided into: the collection of keyword, the confirmation of keyword and the synthesis of buyer confidence index.Finally, the Xiamen City was used as an example to compile buyer confidence index in Xiamen, selects newly-built commodity housing price index, uses these two data to construct vector autoregressive model, and analyzes the relations of buyers’ confidence and housing price. The results show that buyers’ confidence and housing price have mutual influence, and these influence are positive. It means that the improvement of buyers’ confidence will leads to the enhancement of housing price. The weakening of buyers’ confidence will lead to the reduction of housing price. Housing price also has the same influence on buyers’ confidence. But the influence of buyers’ confidence on housing price is greater than the influence of housing price on buyers’ confidence.