The Auction Mechanism Analysis on the Phenomenon of Idle Land

Abstract

With the quick development of real estate, land prices rises rapidly, the Idle Land problem becomes a prominent phenomenon. The resumption of land means loss to estate business, the high land price is one of the key reasons. This article analyzed from the auction method of our commercial land use-right transfer, which is a typical English auction method. This auction method can sufficiently reflect the bidder's assessment of the land, but also prompt the emergence of high land prices. Then sealed second-price auction method is proposed, which is cost-benefit from the bidder's point of view, and avoids the emergence of high land prices. Lastly the policy recommendations are given to promote this approach.