Econometric Research on Current Land Supply in Real Estate Market of China

Land supply has close relation with housing supply. This paper studies the effect of land supply on the average housing price using floor space of housing completed. On the basis of unit root test, an equation of long-term equilibrium relationship among average housing price, per capita disposable income of urban residents and floor space of housing completed is established, using the cointegration theory. The result shows that Chinese tightening policies tropism of total land supply since 2004 is correct, but its duration should not be too long. With the implementation of these policies, it is necessary to raise land supply reasonably in the real estate market.