The Influence Of Monetary Policy To Our Country House Prices

After the reform and open policy, the domestic economy fast developed. The real estate market have also made rapid development. At the same time, domestic housing prices rise quickly. This not only seriously affected the people’s quality of life, but also seriously affected the smooth and healthy development of China’s economic. Since 2005, our country introduced a number of consecutive regulation policies and laws on the real estate market. Domestic scholars conducted a lot of research on monetary policy and real estate prices, to find the law behind the economic phenomena, provide advices for our country’s policy and guarantee the smooth development of economic society. Under this background, I made this research.I use dynamic stochastic general equilibrium (DSGE) model testing and analysing relationship between monetary policy and the real estate price. Before model establishment, I first reviewed the domestic real estate market development process and use the actual economic situation of our country to prove that the real estate market volatility is closely related to monetary policy regulation, as a practical basis for the paper. Secondly I did cointegration test respectively on money supply, output and real estate price.On the basis of cointegration test, I established the error correction model which shows the influence-mechanism between monetary policy impact; economic fluctuations and real estate prices respectively in the short term and long term to provide experience basis for the model.DSGE model established in this paper including family, manufacturers, retailers, central bank four departments.This article has carried on the steady state solution, parameter calibration and estimation and software simulation method, to simulate the real economy, describe how the impact of interest rate shock, technology impact, housing preferences impact effect real estate prices and other economic variables,depict the contains the actual real estate market economy.I found that when the interest rates increases, prices decrease, the retailer’s profits dramatically increased, as time goes on, house prices rose slowly and finally tends to equilibrium level. At the same time, under the condition of different payments constraint, interest rates impact on house prices and family housing loans, housing consumption, the influence of the output is different. When interest rates to a positive impact, with the improvement of down-payment, house prices change from forward into reverse,family housing loans, housing consumption, output has remained a reverse change, and the amplitude decreases, after a period of reduced and when the interest rate increases, prices and out-put decline. These variables volatility will eventually return to steady state level. In the process of research, I discussed the technology impact and housing preferences impact effect on the economic variables. Because it has very little to do with this topic, I will not discuss. At the end of this article,I also put forward the policy Suggestions based on the results of the study.