A Study On Bubbles in The Chinese Real Estate Market and Its Risk

The investment in the real estate market has increased rapidly in the recent years in China. The bank credit capital has helped the real estate market develop prosperously, but it also accumulates a lot of risk at the same time. This article is a study about the bubbles in the Chinese real estate market, the effect made by the bank credit capital and the risk of the bubbles. In our models, we will first figure out the factors that affect the housing price, and make a simple prediction of the future price. Then we will study the effect about the existence of the mortgage on the bubbles in housing price. The other model shows the proportion of the down payment of the mortgage also affect the bubbles in asset price. It will give some advices and suggestions for avoiding bubbles in the real estate market eventually Keywords: real estate market; housing price; bubbles; bank credit capita