Empirical Research On The Impact Of Exchange Rate Changes On House Prices

As we all know,the financial crisis in 2008 was mainly caused by the US real estate market bubble,which ultimately caused incalculable losses to the US and the global economy.If the government can be aware of changes in some things before real estate prices change significantly,and formulate relevant measures to adjust the real estate market,it may be able to maintain the stability of the real estate market.Relevant research shows that when the exchange rate of many countries changes,housing prices also change to a certain extent.Does this indicate that the exchange rate has some effect on house prices? If the exchange rate does have some effect on house prices,it may be helpful for the government to maintain the stable development of the real estate market.Based on the above situation,it is crucial to understand the mechanism through which the exchange rate affects changes in housing prices.This is also the purpose of this study.After consulting various information and literature,we know that the exchange rate does have a certain impact on house prices.Under normal circumstances,the exchange rate mainly affects housing prices through three transmission mechanisms: the expected transmission mechanism,the direct transmission mechanism,and the liquidity utility transmission mechanism.Under certain conditions,the exchange rate mechanism for housing prices is generally the same,but there are some differences in the impact.In order to study the impact of exchange rate on house prices in depth,this paper establishes a panel data model of the impact of exchange rate on house prices,and sets related control variables,including interest rate,money supply,total income per capita,and general price level according to the descriptions in existing literature.This article uses the housing sales price index of 19 countries(or organizations)such as Australia,Canada and France from1996 to 2015,the real exchange rate in US dollars as the standard under the direct price method,loan interest rate,broad money supply,and per capita total income(Substituted with approximate GDP per capita)and monthly data of the Consumer Price Index,empirical research on panel data was conducted.After the Hausman test,the unit root test and the regression analysis of the empirical model,it is found that the exchange rate does have a significant impact on house prices.In general,the exchange rate appreciates and the house price rises;the exchange rate depreciates and the house price falls.After that,different situations were set up to study the heterogeneity of the impact of exchange rates on housing prices.After empirical research,it was found that under different levels of capital control(capital openness),different exchange rate systems,and different degrees ofeconomic development The impact on house prices is the exchange rate appreciation and house price increase;the exchange rate depreciation and house price decline;the difference is mainly reflected in the degree of exchange rate impact on house prices under different circumstances: specifically,the exchange rate affects house prices in weak capital control(capital opening Higher degree)environment than the strong capital control(lower capital openness)environment is slightly larger;the impact of the management floating exchange rate system is slightly greater than that of the free floating exchange rate system;the exchange rate The degree of influence is slightly greater in countries with higher economic development than in countries with average economic development.Finally,this article combined with the empirical relevant conclusions and made some policy suggestions according to my country's specific national conditions from the perspective of exchange rate expectations,money supply,total income per capita,and general price levels.