Empirical Analysis On The Influence Of FDI On Price Of Residential Buildings In China

Real estate is the fundamental industry in our country, which exerts a strong influence on the national economy growth.In recent years,real estate industry made a fast pace development,with the reforming in induatry structure and a series of supporting policies on housing purchase.As an industry with high investment retum, real estate industry is also one of the important sectors in FDI.FDI is an important factor affect the price of the real estate.Based on the foreign direct investment and the related concepts of the real estate market, the paper discussed the way how international capital infow influences Chinese real estate price.Then the paper introduced the basic conditions of China's real estate market and analyed the unequal distribution of foreign direct investment in China by related theories of regional economics. The results show that foreign direct investment in the real estate market has experienced the stages of starting, developing, climax, hesitation and new development. The regional difference and inter-regional difference are both reducing first and then keeping unchanged.Sampling data from 25 provinces with the period running from 2000 to 2008, this paper analyzed the influence of FDI on real estate price. The estimation results indicate that positive correlation exists between FDI and real estate price, and FDI is one of the reasons which lead to the price increase of real eatate in China.Therefore we must confirm the role of the government, consummate the related laws and rules, strengthen the management of the fund about the real estate industry, adjust the policy direction and structure of the FDI and establish the information system and warning mechanism about the FDI in the real estate industry. Only in this way , can the real estate market in China develop well.