Heterogeneous Expectation,Investor Behaviors Difference and Housing Price Fluctuation——Based on the Perspective of Real Estate Behavioral Finance

Abstract

Abstract:

Based on the introduction of investors’ heterogeneous assumptions, the paper studies the internal mechanism of variation in housing price. It analyzes the impact of investors’ heterogeneous behaviors difference on the variation in housing price. The results show that heterogeneous expectation and behavior of fundamentalists and chartists may affect the housing price volatility. Using the data of Beijing, Shanghai, Tianjin, Guangzhou and Shenzhen from 2008-2015, the authors find out that fundamentalists are able to draw housing prices back to their benchmark level and the chartists tend to lead housing prices further away from their benchmark level. Then, the paper introduces the prospect theory to extend the basic linear model to nonlinear models, and analyzes the impact of differences in behavior of investors on the housing price through numerical simulation.

Key words: heterogeneous expectation, variation in housing price, prospect theory, real estate behavioral finance

Zhang Hao, Li Zhongfei, Huang Yuyuan. Heterogeneous Expectation,Investor Behaviors Difference and Housing Price Fluctuation——Based on the Perspective of Real Estate Behavioral Finance[J]. , 2020, 32(5): 42-52.

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