| China’s real estate industry has always been in an important position in national economy,but meanwhile it still has some potential problems,such as long-term sustained substantial price rise deviates from economic fundamentals seriously,which may lead to the crisis of real estate bubble bursting.From the perspective of behavioral finance,scholars find that these problems are related to irrational market sentiment in the real estate market.China’s real estate market is highly speculative and its financial attributes make it vulnerable to the influence of market sentiment.Besides,China’s real estate market is also known as "policy city",which is often guided by government policies.Therefore,China’s real estate market is deeply affected by economic policy uncertainty.Economic policy uncertainty has an impact on the expectations and confidence of investors,which may lead to differences in the impact of real estate market sentiment on housing price volatility.Therefore,from the perspective of economic policy uncertainty,this paper will study the impact of real estate market sentiment on housing price volatility under different fluctuation degrees of economic policy uncertainty.Due to the differences in the development of real estate market among different regions,this paper will also deeply explore the impact of real estate market sentiment on housing price volatility in the first and second tier cities under different fluctuation degrees of economic policy uncertainty.In this paper,the current literature on real estate market,real estate market sentiment and economic policy uncertainty was read and sorted out to understand the current research status.Further,this paper analyzes the herd effect,the expectation theory and the regional heterogeneity of real estate market,and puts forward the research hypothesis of this paper.Finally,this paper will verify the research hypothesis through empirical analysis.Firstly,this paper selects appropriate emotion agent indexes of real estate market by referring to relevant scholars.This paper uses the monthly data of China’s real estate market from January 2011 to December 2021 to construct the sentiment index of overall China’s real estate market as well as the real estate market in first and second tier cities through principal component analysis method.Secondly,this paper selects an appropriate MS-VAR model for the empirical study of this paper.MS-VAR model is used for regional division,which is divided into different intervals based on different fluctuation degrees of economic policy uncertainty.Finally,empirical results are obtained through cumulative impulse response analysis.In order to ensure the reliability of all results,the robustness test is carried out by replacing the key variable.This paper finds,firstly,there is a significant positive relationship between the impact of China’s real estate market sentiment on housing price volatility.This impact does vary with different fluctuation degrees of economic policy uncertainty.The influence of real estate market sentiment on housing price volatility from large to small is the steady state,low fluctuation state and high fluctuation state of economic policy uncertainty.Secondly,the regional heterogeneity of China’s real estate market is prominent.This paper finds that the influence of real estate market sentiment on housing price volatility is regional heterogeneity under different fluctuation degrees of economic policy uncertainty.In the state of high fluctuation of economic policy uncertainty,the influence degree of real estate market sentiment on housing price volatility in second-tier cities is higher than that in first-tier cities.Finally,based on the research conclusions,this paper gives relevant suggestions,hoping that China’s real estate market can develop more stably in the future. |
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