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in the Chinese real estate business.
For one thing, the real estate practitioners in China have applied the knowledge and expertise of risk management into practice, with the weight of 3.72 out of the total weight of 5 for those who are proficient in implementing techniques of the risk management. For another thing, they have to consider the cost and be cost-sensitive, finding that 37.93 per cent respondents have considered that risk management will need extra expenses for real estate investment. Therefore, taking costs into account is crucial, although potential losses that resulted from the lack of proper risk management significantly outweigh the amount of costs. Meanwhile, risk management is also a part of core competitiveness of the corporations.

6.5 The Risk Management Practice in China

The real estate investment processes include four phases: deciding for investment, acquiring the land, constructing the project and selling or renting out. The majority of risks are included in the initial stage, whereas risks lie in the later stages also need to keep an eye on. It has been found by online survey that about 72.4% of the respondents are familiar with risk elements that involve in the real estate projects.
Main risks of the real estate investment include the project risk, industry risk, macro economic risk, considering industry and social factors. The attitudes of real estate practitioners towards risks have been summarized as follows, the results of which correspond to questions 14 and 15 of the survey form.
About 75.86% of the respondents perceived that political factors such as policies are the most influential factor in the real estate investment. The impact and support of Chinese government has played an important role in real estate industry because Chinese real estate industry development is in its initial stage, the development of which is incomplete so that it needs the intervention of government. For example, if the government launched tight monetary policy, the credit and purchasing power will become tight as well so that market situation in the real estate will suffer recession. Therefore, the Chinese real estate corporations need to establish a department that specializes in paying attention to policy changes, which has been wildly established in the corporations located in the coastal region of East China.

Influence of land policy
Other political policies also include the housing policy, land policy, environment policy, tax policy, financial policy and urban planning. 79.31 percent of the respondents consider that land policy is the most important factor in Chinese real estate sector due to special situations of land law in China. Only Chinese government masters the rights to transfer non-agricultural lands into lands that can be used and circulated in the market, the situation of which give rise to the concerns of real estate investors about the land supply due to which land price peaks in the market of public bidding land of China. The land price is much greater than sales price of the surrounded property. Therefore, the Chinese real estate investors have seized opportunities to acquire lands when the land price is low. It has been said that the Majority of the largest Chinese real estate corporations have adequate number of land which is sufficient for about 10 year’s use and development.
The influence of supply and demand
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