Analysis Of The Factors Influencing The Prices Of Real Estate In China Mega Cities

Since the reform and opening up,the urbanization process of China has developed and accelerated rapidly,along with a significant portion of population to migrate to big cities.Up to now,there are 93 cities with populations over one million in China,including seven mega cities with populations exceeding ten million.Coupled with the high population density of big cities,some of the social problems has been exposed gradually,especially the high housing prices in those cities.Not only the people’s livelihood,but also the social stability and development would have been influenced by the housing prices appreciation.Considering the high density of population of mega cities,as well as their leading position in regional economic development,there are important practical significance to explore the factors of housing price appreciation and therefore to come up the effective ways to regulate the rising house prices.Scholars at home and abroad have studied the influences of real estate price from different angles,such as demanding factors,economic factors,resource factors and policy factors.Based on the previous studies,the paper makes theoretical research of real estate market’s current status for mega cities,as well as empirical analysis by using actual data,to understand the contributors of housing prices appreciation.The impacts of increased number of residents,Per Capita Disposable Income,increase of long-term loan balance,interest rate,money supply,and exchange rate,etc.are tested and measured in the quantitative models for empirical analysis.To make the results more accurate and reliable,the model uses monthly panel data for all 7 mega cities(Beijing,Tianjin,Shanghai,Guangdong,Shenzhen,Chongqing and Chengdu)that covering the period from January 2010 to December 2020,with a total of 924 observation points in 11 years.Stationary test and co-integration test were carried out on the panel data to guarantee the valid ity.According to the model results,the increased number of residents,money supply,exchange rate,increased of long-term loan balance,Per Capita Domestic Income,and loan rate have significant impact on the real estate price.Among all of them,the loan rate is negatively impacting the housing price,while all the rest have positive impact on the housing price.