Recently, due to the great impact of fluctuating prices of real estate on economy in the past20years, attention has been focused on the relationship between the fluctuation in prices of real estate and consumption by scholars and government departments.Currently our country is in the critical period of the economic transition, the rate of economic growth is climbing up year by year, but the consumption of residence has not kept up with the pace of economic growth. Weak consumer demand slows down the development of Chinese economy to a large extent and becomes a significant problem in our economy.Real estate price on the consumption of the residents influence mainly can be divided into two aspects:wealth effect and crowding-out effect. All parties focuses is on what is the direction of the influence from real estate market to consumption. Therefore this article studies how the changes of house prices affect residential consumption. This paper, by using2000-2010annual panel data to establish fixed effects regression model to estimate the impact of house price changes on household consumption, through the24cities data for empirical research and the results show that:first, the real estate market has wealth effect in China, but this kind of wealth effect is not very significant, it can be said weak wealth effect, at the same time, the effect of house price fluctuation on consumption is different in different cities, We think many factors contribute to this difference, it is the level of economic development between cities and consumption culture that affect the purchasing power of urban households and purchase intentions. Second, the income is still the primary factor affecting consumer. Finally, based on this puts forward the relevant policy recommendations. |