Research On The Impact Of Real Estate Price Fluctuation On Financial Stability In China

In recent decades,as China’s economy continues to improve,the real estate industry has gradually become a supporting pillar of economic development in China,the real estate industry is a collection of the fund industry,from investment to take place to the final debt collection are inseparable from the support of financial institutions,and due to the high returns,pushing more funds or financial institutions into the real estate market,so the real estate industry and financial industry are closely intertwined.Such a relationship,on the one hand,can promote the better and faster development of the real estate industry,so that more financial institutions to join the real estate market,on the other hand,financial institutions will inevitably be more affected by the real estate industry.Due to the influence of policies and traditional ideas,China’s real estate market has been in a hot state for a long time.If the real estate price appears abnormal fluctuations in a certain period,it will inevitably have a negative impact on financial stability.General Secretary Xi Jinping once again stressed at the 19 th National People’s Congress in 2017 that "houses are for living,not for speculation," demonstrating the country’s determination to maintain the sound and steady development of the real estate industry while reducing its negative impact on the financial system.Therefore,it is of great significance to discuss the relationship between housing price fluctuation and financial stability.By summarizing and summarizing the research status at home and abroad,the mechanism of the impact of real estate price fluctuations on financial stability is sorted out,and a financial stability index system is established,which includes 14 indicators.This paper selects data from 2000 to 2019 as samples and USES principal component analysis to construct China’s financial stability index.Then,through the analysis of the empirical results of the index,a vector autoregression model with four variables was constructed by selecting the market value of stocks in circulation,the asset-liability ratio of enterprises,the average selling price of real estate and the financial stability index,and the impact of the real estate price fluctuations on financial stability was analyzed empirically.The results show that,except for the financial stability in 2008 and 2016,the financial stability has been steadily rising since 2000.It also found that real estate prices do have an impact on financial stability.By introducing different control variables and changing the time frequency of the data,the robustness test was conducted on the empirical results above from three aspects based on the panel data of 31 provinces and cities.Finally,through the summary of empirical conclusions,from the real estate market problems and how to reduce financial risks,put forward some targeted Suggestions.