【Economic】Analysis of reasons fo

【Economic】Analysis of reasons for high housing prices in China

陶Aaron 陶Aaron 

Analysis of reasons for high housing prices in China

When we talk about high housing prices in China, we need to analyze these stakeholders.Local governments, real estate developers, demolition and relocation households, homeowners/speculators, homeless.

I. Local government

Local governments make most of their money from land tenders and auctions.The rise in real estate prices will greatly promote land auction prices and increase the revenue of local governments.It is the instinct of local governments to promote high-priced land transfers within their jurisdictions to raise taxes.Therefore, if the housing price falls, the tax revenue of local governments will be seriously affected. As a result, local governments will try every means to intervene in the real estate market, control the land supply and avoid falling, and it is better to achieve steady growth.

II. A real estate agent businessman

The pursuit of profit is the nature of businessmen, and various marketing is to improve the price of real estate, to achieve the purpose of rapid profit.

III. Demolition and relocation households

This is also a beneficiary of the real estate industry.The e old houses of farmers who used to live in the old houses can be subsidized after demolition and become the demolition households with millions of levels.This kind of sky drops big pie opportunity, let a person produce envy to estate industry at once simply.Class identity is transformed.So demolition subsidies the more the better, the bigger the house the better.It is the home-buyers who end up paying for the high prices.

IV.Homeowner

Most people have only one or two homes, but rising prices have led to rising asset values for homeowners, giving them a sense of growing wealth.Whether he's cleaning now or working for his boss, any increase in the price of a home will increase the group's definition of who they are.A few suites tens of millions, life winner.Thus once again strengthened the sense of buying a house to earn money, become a real estate chaser.Mortgage your house, borrow money, buy more houses.

V.Homeless

The people who have no houses in the city are the most miserable. Most of them are foreigners.Just arrived in this city, no house, no money, here work hard to earn money to save money, hope one day can have a home.But the burden of living, the old people in the family, and the young children, are all waiting for a very low income to be filled.The biggest characteristic of this group of people is the lack of money, no money, so there is no way to buy a house, but the cost of living is rising rapidly.Real estate prices will drive up rents, consumer goods around them, and the cost of living will be higher.

You'll find that out of the five stakeholders, only the homeowners really want a bargain.Ironically, when homeowners do their best to buy a home, they become the fourth group, a loyal promoter of house prices.

It is the first four groups that raise the housing price and the whole industrial chain of the real estate. When the whole industrial chain is trying to improve the value of the real estate, it becomes a very difficult problem to regulate the real estate

.

In a word, the high housing price in China is the result of the whole social group.

Regulating housing prices has a long way to go.