A Study On The Market Power Of Chinese Real Estate

Real estate is constituting an important part of the whole social wealth, its development is an important force to promote the industrialization and urbanization. And it has become the hot spot and focus of attention.How to guarantee the healthy development of the real estate industry, and make people have house to live in, which are great realistic problems and are theoretical issues need to be deeply studied. Stable and healthy development of the real estate market affects the safety of the financial system, and also affects macroeconomic stability and development. The bursting of the real estate price bubble in Japan and Southeast Asia used to be the direct trigger of the economic and financial crisis. Our country are also emerging overheating of real estate development.Real estate prices, investment, vacancy rate continued to rise. In order to promote the healthy and steady development of real estate.The Chinese government and the community began to explore through developing and improving the real estate control policies to improve the operation of China’s real estate market.A clear understanding of the real estate conditions is the premise to make real estate polices.And the real estate market forces can be used as the basis of the real estate market situation. Market forces can be assessed using a number of indicators.Commonly used measures are market performance standards, market structure standards and market behavior standards. Market performance standards include the Lerner Index, Bain profit targets. Market structure standards include industry concentration ratio, the Herfindahl-Hirschman Index. Enterprise competitive behavior standards. After analysis, the Lerner index is more suitable for China’s real estate market forces.Unlike existing study about market forces and the welfare losses, the main line of the real estate market forces is empirical research and analysis. This paper use each of China’s provinces and35large or medium-sized cities’ real estate sales data for samples,and Lerner Index to calculate indicators of China’s real estate market forces. The estimated results show that China’s real estate market has widespread market forces.Property developers obtained huge excess profits by using market forces. The real estate market forces are too large, which is not conducive to long-term healthy development of the real estate market and the improvement of the welfare of residents.Our government needs to be targeted to regulate the real estate market.This paper combines Normative and empirical, quantitative and qualitative analysis to research China’s real estate market forces.The study is divided into six parts. The first part is the introduction.This part includes putting forward the background and significance of researching China’s real estate market forces, introduces the ideas and methods of the research, the framework of this paper, the innovation and insufficient. The second part of the research is literature review, which include reviewing domestic and international studies about theoretical and empirical studies of market forces, and summarizing the related research point of view in every time period. The third part is main about studies of the real estate market forces theory.First.Summarize the methods of measuring market forces and the effects of market forces. Through reviewing and summarizing the interpretation at home and abroad of market forces’meaning, this paper tries to define the meaning of the real estate market forces. Second.This paper bases on three angles, market performance, market structure and market behavior, introducing several key indicators to measure market forces and analyze these indicators’ principle, assumptions, strengths,weaknesses and functional equations. Third.The theoretical analysis of the welfare effects caused by the real estate market forces. The fourth part of this paper is based on Lerner Index to set model, and selects the country as a whole, the provinces, major cities in three levels of commercial housing sales data for samples,and measures China’s real estate market forces, and explain the estimation results briefly. The fifth part is to explore why China’s real estate market forces is so high.The main reasons tend to be:financial factors, structural barriers to product differentiation, the institutional barriers to the supply of land, the real estate market demand, imperfect functions of commercial housing alternatives, developers strategic behavior. The sixth part of this paper will focus on the situation that China’s real estate market forces is too large.Trying to put forward some views and recommendations of the reform what mainly including the following aspects: improving land supply situation, improving the system of indemnificatory housing, adjusting the real estate market demand and regulating the main participants’ behaviors of real estate.