Monetary Policy, Financial Constraints And The Real Estate Business "Money"

Since 1998, China’s real estate market-oriented reforms. The real estate industry has become a pillar industry to promote China’s economic development. The housing price fluctuations on the macroeconomic impact are also more obvious. With the real estate economy in the growing importance of the national economy, the real estate market regulation is also much attention. Especially in recent years, high prices led to a series of economic and social problems, but also caused the attention.China’s real estate industry is a typical capital-intensive industry, with capital demand and heavy reliance on external financing characteristics. In this paper, the relevant literature is reviewed and summarized based on the real estate market. According to China’s own characteristics, we study the monetary policy for China’s real estate business economic activity, and analyses the cash holding and investment-cash flow sensitivity of listed real estate companies in the micro-level to explore monetary policy in the real estate market regulation effect and to explore if monetary policy can affect the real estate business "money".In order to explore the regulating effect of monetary policy on real estate enterprises and make a thorough inquiry on the ―affordable‖ source of real estate enterprises, this text selects cash holding and investment-cash flow sensitivity these two representative index from microcosmic view, use two-stage SYS-GMM and SYSGMM method separately structure the six relation models: monetary policy and enterprise investment, monetary policy and enterprise investment-cash flow sensitivity, financing restriction and investment-cash flow sensitivity, monetary policy and enterprise cash holding level, monetary policy or financing constraints and enterprise cash holding level. This article also investigate thoroughly about the relation of monetary policy or financing restriction and the real estate enterprise, then retest the models above-mentioned using POLS and dynamic FE to ensure the result’s stability.This text’s research is conducive to deepen the government’s cognition on monetary policy effectiveness in real estate market. It brings to the forefront of decision maker on the effect of diversity that monetary policy in different enterprises and drafts the corresponding monetary policy to provide certain reference for current situation of hot real estate market and high housing price.