Analysing the demand factors affecting housing price index in China

• Main Author: Rui, Lan
• Format: Thesis
• Language: English; English
• Published: 2015
• Subjects: HG Finance
• Online Access: https://etd.uum.edu.my/5137/1/s815886.pdf; https://etd.uum.edu.my/5137/2/s815886_abstract.pdf; https://etd.uum.edu.my/5137/

House prices in China has experienced significant price soaring over the past few year especially in large cities such as Shanghai and Beijing. This is a worrying trend for buyers and investors in China. This research attempts to identify factors that influence on China’s house prices index, from year 2010 until year 2014. The study used six independent variables which comprise of inflation rates, GDP growth rates, interest rates, mortgage rate, and money supply of M1 and RMB exchange rate. Various methods had employed for this study comprising the monthly secondary data which range from year 2010 until year 2014. The models are categorized into three categories like Common Macroeconomics Model, Enhanced Macroeconomics Model and Combine Macroeconomics Model. All of these models are analyzed by using technique of Descriptive Analysis, technique of Pearson Correlation and technique of Multiple Regression Analysis. This is used to explore the relationships and the impact of the independent variables towards the dependent variables. Empirical result shows that only interest rate, mortgage rate, money supply of M1 and RMB exchange rate are having influences on China’s Housing Price Index. Empirical result also shows that money supply of M1 is having the greatest impact on China’s Housing Price Index, followed by RMB exchange rate, mortgage rate and lastly interest rate. This research has proven that China’s Housing Price Index indeed influencing by various Macroeconomics Variables