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A Study of the Debt of Real Estate-Related Industries

  • Xiaohuang Zhu
  • Song Lin
  • Lin Wang
  • Wenqi Wu
  • Quanli Qin
Chapter

Abstract

This chapter focuses on the debt turning point of the upstream and downstream industries relative to the real estate industry. Considering the importance of real estate-related industries to the national economy, and the fact that the total output of these industries accounts for as much as 20% of the GDP, we selected six industries – coal, iron and steel, non-ferrous metals, building materials, household appliances and real estate – for analysis and turning point estimation. As in the study of China’s debt as a whole, a linear regression model was adopted, with the profit of an industry’s core businesses as the independent variable and the debt size and its square as the dependent variables. After working out the coefficient of regression, we can determine whether the industry has reached the turning point of its debt. With further calculations, we could determine the debt size and industry profit at the turning point. Then we also could identify the time when the industry reached (or will reach) its debt turning point. The results showed that the coal industry reached its debt turning point in 2011; the iron and steel industry reached theirs in 2012; the non-ferrous metal industry and the real estate industry both reached theirs in 2013; and only the building materials industry has not reached its turning point.

Copyright information

© Springer Nature Singapore Pte Ltd. 2018

Authors and Affiliations

  • Xiaohuang Zhu
    • 1
  • Song Lin
    • 2
  • Lin Wang
    • 3
  • Wenqi Wu
    • 4
  • Quanli Qin
    • 5
  1. 1.CITIC GroupBeijingChina
  2. 2.Central University of Finance and EconomicsBeijingChina
  3. 3.Risk Management DivisionChina Construction BankBeijingChina
  4. 4.China Asset Management CompanyBeijingChina
  5. 5.RenMin University of ChinaBeijingChina

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