Research On The Wealth Effect Of Chinese Real Estate

Real estate wealth effect,refers to the impact of changes in house prices affect the value of property owners and then affect their consumption process.For a long time,in the investment,export,consumption of the "Troika",the contribution rate of consumption is relatively low.In the "new normal",expanding consumer demand is the best choice to solve the problem of sustainable growth.In the past two decades,real estate has become a major component of household household assets,and the proportion has risen rapidly with the rise of house prices.In this background,the study of real estate wealth effect has gradually been concerned about.The study of real estate wealth effect is mainly based on modern consumption theory.Modern consumption theory can be divided according to their stage of development of consumer theory under certainty conditions,consumption theory under conditions of uncertainty,consumer behavior theory.Accordingly,Chinese scholars put forward the theory of consumption in China.There are unstable income and expenditure hypothesis,life cycle special stage consumer behavior hypothesis,consumption hypothesis hypothesis,credit consumption system constraint hypothesis and income uncertainty based on the precautionary savings hypothesis.Based on the theory of consumption under uncertainty,this paper puts forward four main effects such as direct wealth effect,optimistic expectation effect,liquidity constraint effect and preventive saving effect.Based on the theory of behavioral consumption and consumption theory in China,this paper puts forward four kinds of negative effects such as policy impact effect,household registration effect,intergenerational consumption and habit formation effect.Then this paper constructs the dual-level real estate wealth effect transmission mechanism which includes the main and the side effects,and depicts ten ways China’s house price changes affect consumption.Finally,based on the previous research on the conduction mechanism,this paper makes four inferences about the characteristics of wealth effect of Chinese real estate.Inference 1: China’s real estate wealth effect may not be significant,or even negative;Inference 2: Different real estate wealth effect in each city;Inference 3: Different types of consumers have different real estate wealth effect;Inference 4: The effect of real estate wealth on different categories of consumer goods is different.The empirical study of this paper examines the four inferences from the macro and micro perspectives.Empirical test results with the macro data show: China’s short-term real estate wealth effect is significant;the value is 0.13 and positive.And there is no long-term real estate wealth effect.There are differences in the wealth effect of real estate market in different cities in China.And this difference is quite random,the size of the city and the propensity to consume are an explanation of this difference.From the consumption structure,short-term real estate wealth effect change in consumer spending in education,culture and entertainment services.The value is 0.27.Although the long-term wealth effect of total consumption does not exist,there is a significant long-term real estate wealth effect in the field of household equipment supplies and services,transportation and communication,educational,cultural and entertainment services.Empirical test results with the micro data show: From the household registration system,the real estate wealth effect of urban households is 1.4 times that of rural households,and there is imbalance between urban and rural areas.From the perspective of population mobility,the real estate wealth effect of resident population is 0.14,and the floating population is 0.16.From the regional differences,the eastern,central and western real estate wealth effect is 0.16,0.11 and 0.14,the highest in the east,the western center,while the central minimum.And whether the mortgage or education loans,the family’s real estate wealth effect no difference.From the consumption category,housing appreciation,luxury goods,health care,general consumer goods consumption increased the most,followed by clothing,tourism,durable consumer goods,education consumption increased less,vehicle consumption decreased.According to the different types of families,rural households have stronger real estate wealth than those of urban households in the case of consumer durables.The floating population is stronger than the resident population in all kinds of consumption,and the families in the eastern region are stronger than those in the central and western regions.The empirical test proves that the inference 1 is not exactly correct,and the inference 2,3,4 is consistent with the empirical test results.Combined with the empirical test,this paper puts forward four related policies and suggestions: improve the real estate market-related construction,speed up the financial product innovation,improve the property tax,estate tax and other related tax system construction and strengthen the security system.