China's Regional Housing Market Price Volatility Characteristics Of The Difference

The current academic studies on the housing market focus on the whole national level, and in practice, the housing market macro-control policies issued by our central government have not fully considered the unbalanced development of regional housing market. Regional differences are important characteristics of the real estate industry, so only if the studies think about the difference among the regional real estate market, the results will be convincing. Based on this background, this article studies the different characteristic of price volatility in China's different region housing market.In reference with nonlinear dynamics theory, this article diagnosis the nonlinear characteristics of housing market in China's 30 provinces and cities, and studies the regional difference among the areas. We use 28 most commonly used time-series process to fit the housing market returns series of 30 regions. By BDS test we diagnose whether there are nonlinear characteristics.Empirical study results show that the housing market of different regions of China have different price fluctuation characteristics. Based on the nonlinear characteristics of data series,we classify these 30 housing markets into four categories: the first is series that is ARMA process, like Chongqing, Hebei, Hunan and other four regions; the second is series that is random walk process, like Chongqing, Hunan; the third is series that is EGARCH-M process, like Sichuan, Gansu; and the other 80% regions, including Anhui, Beijing, Shanghai, which are nonlinear testing by BDS. Conclusions of this study support that there are regional differences in China's housing market.The innovation of this paper includes two parts: firstly, the application of nonlinear theory to examine the characteristics of housing price fluctuations. Nonlinear theory is rarely applied in the housing market. It explains the dynamic behavior of asset prices from the perspective of dynamics, and studies the serial nonlinear characteristics. This method has been very extensive and mature. Secondly, the study on the nonlinear characteristics of price fluctuations in different regional housing market, for which to find the reasonal fitting model. In theory, the models can be used for the analysis, forecasting and risk management research of regional housing market. Additionally, this article could provide reference for central government to accurately analyze, evaluate and procast the housing market, which can be helpful for making reasonable regionally different macro-control policies to balance the development of regional housing market and achieve overall healthy development.