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1、The Government Intervention of Real Estate Marketin Principals of EconomicsZhao XinSchool of International Language, Shanghai Institute of Foreign TradeTel: 188-1823-1823 E-mail: ChrisxinaFAbstract The real estate industry is an important pillar industry of Chinas new era, faced with high prices, th
2、e rapid growth of the scale, the lack of market behavior norms, real estate speculation and other serious problems. Chinas real estate industry is at a critical period of development, pay close attention to the existence of the bubble phenomenon must be aroused. Today, the ongoing debate on the futu
3、re price trend continued to climb or crash. Policy efforts from various angles stringent price control inhibit the breeding of the real estate bubble.Key words: Real estate bubble, Real estate market, Government intervention1. Current situation of real estate market in BeijingAt present, near the Be
4、ijing XiSanHuan Wanliu rent a $3 million worth of housing rent is 8000 yuan, in Huilongguan rent 1 million yuan worth of housing rent is 2500 yuan, nearly all price-to-rent ratios in also between 5-400. International real estate used to measure a region of running in good condition of rental ratio i
5、s 1:0. Thus can see Beijings real estate bubble is very serious.1 Fully rational consumer attitudes, according to the comparison of rent and interest, you can draw the following conclusions: Beijings real estate bubble is now about 40%, because the rent is approximately equal to 60% of the interest
6、to buy a house. But taking into account the situation in China, most of the Chinese people would not invest in financial management, and many people think that only live on their own to buy a house that was safe, this national conditions can about half of the real estate bubble will not burst. So I
7、think by todays prices, about 20% of the real estate bubble will burst. Other factors take into account the different sections of the Beijing real estate prices in 2010 fell by 10% -30%, but does not rule out some of the special section of house prices continue to encounter new positive opportunitie
8、s, there will be some the core business district of house prices to continue, because of the accumulation of intangible assets of the business district, but this is rare. For example, a lot of the house is now inaccessible, but soon after this place plans to build a subway station, or the constructi
9、on of a new road, these favorable opportunities will cause housing prices. Of course, if you participate in the knucklehead continued to increase and desperate, the Beijing real estate bubble burst time may be postponed until 2011, but in any case, this huge bubble will break.2. Chinese government p
10、olicy intervention of real estate market In order to curb housing prices in 2010, the central government introduced a series of real estate control policies, economic instruments and administrative means and from the curb demand, increase supply and strengthen supervision of the Chinese real estate
11、market a full range of regulationRestriction order(限购令）2 is clearly stated in the April 30, 2010, Beijing issued ten countries, the implementation details: from May 1, 2010, the Beijing family only new purchase a house, buyers who buy houses,also need to truthfully fill out a family member returns,
12、if they are found to provide false information to the fraudulent purchase of housing, will not handle real estate license. This is the first national family purchase of copy number restriction order.2.1 Curb demand From May 1, 2010, the Beijing family can only buy one new commodity house.2.2 Increas
13、e regulation In parts of price policy, such as the economy applicable room and the price the room price. Buyers who buy houses, also need to truthfully fill out a family member returns. If they are found to provide false information to the fraudulent purchase of housing, will not handle real estate
14、license.2.3 Increase supplyLand supply, increase of housing land supply, clear price and affordable housing land supply policy. Large-scale construction of affordable housing, give more choices for customers. 3. The effect of government intervention3.1 First of all, increased housing supply and tigh
15、tening housing land is the main reason for surging real estate market, reducing the land supply of high-end residential and commercial real estate, only from the source to solve the ordinary housing shortage situation.3.2 Second, curbing speculative housing demand, increase the second-hand house sou
16、rce, greatly reduce the interests of property speculators, from two aspects, the source of funds and tax work, cooling the property market hot money hype.3.3 Third, the transition of the function of the government to adjust the real estate market has played a positive role, traditionally the governm
17、ent is the biggest beneficiary of the real estate industry, hence reducing prices must need the government out of the interests of the real estate group, the savings to the people, for the government to become real estate market regulators rather than the pilot, a huge help for the real estate marke
18、t return to normal.3.4 Finally, although now property prices is gradually shrinking, but the price cant guarantee for a period of time after the real estate speculation boom wont again surges, so the government should face up to this problem, cannot escape, more cant participate, can let the people live, live the quiet room.4. Evaluation High prices under the governments housing reform policy, price dropped to a satisfactory level, but has also been a certain degree of inhibition. Thus, this shows the housing reform results.References1 Peng , Joe. (2009). Online Available:2 Online Available:
