The Impact of Economic Uncertainty on the Cash Flow of Listed Real Estate Companies in China

Abstract

After the policies of "no speculation in housing" and "three red lines" have been introduced one after another, more real estate enterprises have heard the news of "thunder explosion" one after another. Based on this, it is particularly important to explore how real estate companies can develop under the influence of increasing economic policy uncertainty. Among them, cash flow is very important for real estate enterprises. Based on this, this paper uses TVP-VAR model to simulate the impact of economic policy uncertainty on the cash flow of listed real estate companies in the important regulatory period and time point of national policies. It is found that the cash flow of operating activities is most affected by economic policy uncertainty, while the cash flow of financing activities is relatively less affected by economic policy uncertainty. Cash flow from short-term operating activities is more sensitive to impact performance, and cash flow from investment activities is more intense in the long run; At the same time, it explains the conclusion that the government is making efforts to end the "barbaric era" of capital power. Based on the conclusion, this paper puts forward some enlightenment, such as strengthening cost management and strategic adjustment, and for high-risk real estate enterprises, we can consider looking for positioning transformation.