Longquan Real Estate Market Bubble Study

At present, real estate industry is becoming one of the most important pillar industries in national economy. It concerns not only the future development of Chinese economy, but also every one of us. Because of the disserve and its breaking out suddenly, the government's cost of taking measures to control the bubbles is very great. The real estate bubbles, which appeared in Guangxi province around 1992, represent that the research and precautionary measures on bubbles have prominent theories and actual meanings to national economy. Since 2002, the real estate price has moved upwards non-smoothly in most cities in China. It is extremely important to analyze the problems about real estate bubble.Based on the collection of the information on the estate bubbles from the home and abroad, this dissertation analyses the features of real estate market, the law of supply and demand, the existing situation of Chinese market, and the reasons causing real estate bubbles. Theories of microeconomics, real estate bubbles and real estate evaluations are applied to summarize the approaches for testing market such as supply and demand analysis, mathematic modeling, indicator analysis, and comparison analysis.Through looking into a great deal of first-hand information about real estate transaction and market research and analyzing the structure and relationship between the supply and demand of recent real estate market of Longquanyi District, it comes out that the market is developing in a speedy, health way. Then, a systematic analysis is taken out by making use of model testing approach of real estate market. On the basis of the research data, a conclusion is drawn that there is no significant foam in the Longquanyi real estate market. However, because of the"too much"investment in real estate market, there are potential factors which may lead to bubbles. The analysis of economic indicators and comparison is made in order to get a further confirmation and find out the existing problem in the market.Finally, according to the conclusion of bubble test, macroeconomics situation and the local economy environment, some strategies and measures are put up.