Research On Listed Real Estate Company’s Balance Sheet Repair

As a basic industry of China’s national economic development, real estate industry’s healthy run not only relates to its constant development, but also more relates to the quality of the operation of the entire national economy. Its market mechanism closely relates to the international economic environment, the domestic economy development, changes of national policies, people’s living standards and the financial sector reform. After a series of economic stimulus plans in2008, China’s real estate prices speed up. In order to prevent the irrational rise of real estate prices, the Administration has issued a series of regulatory policies and a stringent control signal to the market. Since last September, the high momentum of the prices has somewhat curbed and the real estate sales have sharply declined. Foreign investors pulled out of the real estate market in China, part of listed real estate companies reported financial data to show its serious balance sheet problems, similar to the corporate balance sheets situation of the U.S. Great Depression in the1930s and the1990s Japanese economic bubble period. At this point, the problems of the existence of our real estate bubble and the ability to trigger the type of balance sheet recession aroused widespread concern.In this paper, in the study of Chinese real estate market, the latest theoretical achievements of balance sheet recession hypothesis are used for the first time. There is also a comprehensive use of the theoretical knowledge of finance, accounting, financial and other disciplines. This paper firstly uses the indicator analysis of China’s real estate bubble and then a brief analysis of bubble formation causes, focusing on the financial statements of listed real estate companies-the balance sheet from a new perspective, combining with the accounting relevant knowledge, using certain financial indicators, quantitatively exploring the possibility of China’s real estate bubble causing balance sheet recession. Subsequently, it briefly described the effect of the possible impact of such downturn, followed by a number of suggestions from a new perspective, aid listed real estate companies balance sheet repairing, in order to promote our real estate return to rational, healthy and orderly development. Finally, it listed the prospects for the development of China’s real estate, putting forward the idea that the future of China real estate market may appear layered, waiting for scholars to do more in-depth researches.