The real estate cycle and financial stability are closely correlated. In light of global real estate bubbles, China ＂s real estate cycle has attracted wide attention since 1998. The present paper analyzes three drivi...The real estate cycle and financial stability are closely correlated. In light of global real estate bubbles, China ＂s real estate cycle has attracted wide attention since 1998. The present paper analyzes three driving factors in the context of the current real estate cycle; namely, economic growth, maeroeconomie environment and institutional establishment. Supported by econometric analysis using quarterly data from 1992-2004, the present paper indicates that real estate will develop steadily and that housing priees will consistently rise in the relative long run. Based on quantitative analysis, it is concluded that the implications of the current real estate cyele for finaneial stability include risks of real estate credit exposure, government guarantees and maturity mismatch. Some eorresponding poliey implications are discussed, such as advancing banking reform, encouraging the rational behavior of local governments and strengthening the regulation of foreign eapital flows in and out of China＇s real estate industry.展开更多
文摘The real estate cycle and financial stability are closely correlated. In light of global real estate bubbles, China ＂s real estate cycle has attracted wide attention since 1998. The present paper analyzes three driving factors in the context of the current real estate cycle; namely, economic growth, maeroeconomie environment and institutional establishment. Supported by econometric analysis using quarterly data from 1992-2004, the present paper indicates that real estate will develop steadily and that housing priees will consistently rise in the relative long run. Based on quantitative analysis, it is concluded that the implications of the current real estate cyele for finaneial stability include risks of real estate credit exposure, government guarantees and maturity mismatch. Some eorresponding poliey implications are discussed, such as advancing banking reform, encouraging the rational behavior of local governments and strengthening the regulation of foreign eapital flows in and out of China＇s real estate industry.
