The Study On The Measurement Of Chinese Residents' Potential Consuming Capacity And Its Relationship With Real Estate Price

The real estate industry is an important component of a country's economy, the national household consumption and investment. The real estate is the major physical assets, which is held by individuals and institutions. In China, the real estate industry has become a pillar industry of national economy as an emerging industry after 20 years of rapid development. It plays an important role in the national economy. Through a series of mechanisms and channels, the prices of real estate had a significant impact on a country's economy and monetary policy system. It is one of the main performances that the volatility of prices has increasingly become a country's macroeconomic indicators of the first. A sharp rise in housing prices may mean that the future level of prices and output rise. The sharp decline in housing prices may herald the future of macroeconomic tightening and even recession. So the real estate prices have aroused wide attention of Governments, and the real estate market has increasingly become scholars'the focus of attention.The influencing factors on fluctuations in real estate prices have always been a hot research issue about the real estate. Scholars have started a lot of theory and empirical research on the relationship between real estate prices and factors associated with prices. However, the shortage is that a large number of studies have examined variety of factors about the impact on property prices. Literatures are relatively small, which are about residents'potential consuming capacity impacting on property prices. But this issue is very important to the internal demand reasons of the rise housing prices– increase in purchasing power. While, according to the search results, I found that domestic scholars in the field of research is still in a state of almost empty. The residents'potential consuming capacity doesn't have a precise definition, as well as how to measure the relevance of research. And valuable research is one of the few. Therefore, I take this issue as my master's thesis topics. I tried to establish the framework researching relevance between the real estate prices and Chinese residents'potential consuming capacity. Using the method of combining theoretical analysis with empirical research, I measure the residents'potential consuming capacity, research the relevance of house prices in China and it, and ultimately arrive at the conclusion of the study.In this paper, according to Chinese actual situation, data collection, as well as the concept of assets, by the method of fixed assets deflator inspiration the potential spending power of Chinese residents'potential consuming capacity is expressed as:As the base period 1999, I calculated the residents'potential consuming capacity in 30 provinces, autonomous regions and municipalities directly under the central in the years of 2000-2006. The calculation results can be seen the residents'potential consuming capacity in various growth year-on-year from 1999 to 2006. And the growth rate of the capacity began to increase significantly in 2003. There are obvious differences in areas. The residents'potential consuming capacity in eastern coastal areas is power than in the central, western higher.After the measurement of Chinese residents'potential consuming capacity, I analyze qualitatively some of the more important factors which affect housing prices. Then I have a comparative analysis of quantitative with the residents'potential consuming capacity, and the process of urbanization, land supply, real estate investment, real interest rates and gross domestic product of the five major factors affecting the price. Use the fixed-effect panel date model to estimate, and test the extent of the impact of consuming ability to housing prices. There is a clear change in prices, land supply and interest rates in 2003. So the panel data model is divided into two periods in 2003 as a dividing line. The results showed the coefficients of the potential consuming capacity impacting on the real estate prices were significantly affected in these two time periods, and the influence of the potential consuming capacity is stronger than it of other factors. As well as the influence coefficient 0.0189 from 1999 to 2002 rise to 0.0218 from 2003 to 2006. This shows that the potential consuming capacity impacting on housing prices is relatively large and this study is very significant.After the verification of the potential consuming capacity having a great effect on housing prices, I use the four-quadrant model for comparative analysis of static methods to analyze how the potential consuming capacity influence on the real estate market and housing prices from the theoretical analysis. After the qualitative analysis, we analyze the potential consuming capacity impact on property prices from the point of quantitative. I establish two panel data models about time and regional differences to analyze quantitatively on the relevance of the potential consuming capacity and housing prices.First, I take a comparative analysis on cumulative effect and current effect of income impact on the real estate prices, immediately compared the potential consuming capacity and residents'potential disposable income in real estate prices. I adopt the following three models of panel data fixed effects model to estimate: Empirical analysis shows that, at this stage, so rapid growth in property prices is decided by the growth of the wealth accumulated, rather than current disposable income. At the same time, this result also shows that the cumulative demand up to a certain extent of the outbreak was caused by the rapid rise in property prices.Then we research the regional differences about the residents'potential consuming capacity and real estate prices. In this part, I use the methods of cointegration analysis of panel data. Before cointegration panel data analysis, I do the panel data unit root test, and then cointegration test, finally adopt the method of fully modified ordinary least squares on the estimated cointegration equation.The results show that the difference of the potential consuming capacity determines the inter-regional difference in the real estate market prices. And I found that the more developed economies of the region, the smaller the potential consuming capacity impact on real estate prices.