The Financial Risk and Precaution of Real Estate Enterprises

Because of the soaring housing prices and the problems of real estate industry, state has already regulated and controlled this development, so that real estate industry will face more financial risks. In order to lead our real estate enterprises to adapt national macro regulation and restriction, this paper investigates into financial risks in real estate by means of inductive method and factor analysis approach. Discussions are also made about risks brought about in association with financing, investment, the recovery of capitals and unstable cash flow in property enterprises. From a strategic perspective, it probes systematically into causes for risks above mentioned from both a macroscopic view and a microscopic view. Solutions are proposed to potential risks in routine business in property companies, e.g. financing in multiplex ways, strengthening the recovery of all receivables, performing scientific and feasible analysis of investment projects, ensuring the integrity of capital chain and so on. Trough analysis of this essay, only analyzing and dividing the financial risks scientifically, can find measures according to specific case to reduce the financial risk.