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How important is the real estate industry? From the subprime crisis sweeping the globe can be seen, the real estate industry on a country's economy and the global economy have a profound impact. In fact, in many countries, the real estate industry and the country's economic development are closely related. In the current stage of rapid development of China's economy, the real estate industry's position is even more important. Premier Wen Jiabao at the Fifth Session of the Tenth National People's government work report clearly states: \special social-economic status: First, people's housing conditions for the real estate industry relationships, and build a harmonious society we live two prerequisite; Second, real estate is a long chain of the industry, to stimulate growth in related industries. According to World Bank data, the mid 1980s to the early 1990s, developing real estate investment multiplier effect on related industries is about two times, and the product group led by real estate real estate chain downstream and upstream over 50 a material production sectors induced or affected. Specific to China, real estate investment and consumption strong stimulating effect, so that the industry's rapid economic growth on China maintained a high contribution rate. In recent years, the contribution rate of 2 percent or more, real estate and construction industry accounts for the proportion of GDP is more than 10%. At this point, we can see that the real estate industry as well as for society as a whole and healthy development of the national economy plays a vital role. How to keep the real estate industry sustained and stable development, especially in the global financial environment changing circumstances, how can we make our real estate crisis into opportunity, continue to drive China's economic growth, has become a hot issue. In the rapid growth of China's real estate industry, and gradually become a new growth point of China's national economy, while the financing of real estate has become more prominent. The real estate industry as a typical capital-intensive industry with high investment, high risk, long life cycle characteristics. In every real estate project development stage, the huge financial support are essential. However, there is the strength of China's real estate business in general is not strong, outstanding performance on the lack of financial strength. In order to achieve the state of real estate projects proportion of own funds requirements, real estate companies hesitate to use various alternative methods, such as related party loans, cash in bank loans to act as its own funds. Plus the construction side of the vast majority of advanced models also come from banks, deposit and Yushoukuan buyers have 80% mainly rely on bank of individual housing loans. Therefore, in this rolling capital chain, direct and indirect development bank funds can account for 60% of total funds, and some even reached 80%. It can be said, bank credit funds are actually supporting a major real estate developer operating working capital chain. This led to a single bank credit financing structure, not only the banks and the whole financial system suffered a huge risk, but also the real estate industry of the capital chain has become very fragile, hindering the healthy development of enterprises. In the past few years, we have seen some of the relevant policies and macroeconomic situation changes, companies are making real estate financing difficulties have become increasingly prominent, corporate capital chain under great drag, a serious threat to the survival and development of enterprises. In the country actively looking for real estate enterprises to explore new financing channels at the same time, the real estate investment trust into the people's attention. Real Estate Investment Trust as a link social capital and real estate markets industrial investment tool in the overseas after nearly 50 years of development, has shown tremendous institutional advantages and development potential. REITs (Real Estate Investment Trusts, referred REITs) originated in the United States, it is essentially a securitization industry investment fund is determined by the fund companies and other sponsors beneficiary certificates issued to investors, the social capital together, by a reputable financial institution acting as custodian of funds raised will use these funds for investment in real estate securities or real estate development projects. In the investment process, issuers pay more attention to diversifying investments, the funds invest in different regions and different types of projects, the real through centralized professional management and diversified portfolio of investments, effectively disperse risk, achieve a higher return on investment. From the above definitions, we can easily see that real estate investment trusts as a financial instrument, is a form of real estate securitization. Real estate investment trusts in the world has been able to get such a huge development, because of its unique advantages: First, the real estate investment trust fund has a professional investment consultant team, the team of experts with specialized knowledge and extensive investments in investment experience and use its wide range of information channels, through appropriate techniques for domestic and international economic situation, the various industries as well as individual company's operating condition and financial analysis of the situation, to get the appropriate investment objectives and investment opportunities. Since REITs, real estate investment targets, ordinary investors intractable, through this professional management, real estate investment can greatly improve operational performance, enable investors to share real estate professional investment results. Second, real estate investment trusts portfolio effects not only in the dispersed funds raised to invest in different regions, different types, different methods of operation on the property, but also in part of the funds will be invested in bonds, stocks and other securities, and For this part of the share capital of the proportion of all funds, but also in accordance with national laws and regulations vary. Again, REITs through the issue of shares to public investors in mutual funds or units to raise funds and the formation of the fund. Fund assets are broken down into shares or units of mutual funds in foreign capital markets mature, these beneficiary certificates can usually be traded, and therefore, the real estate investment trusts with strong mobility. Finally, as mentioned in the literature review, like real estate investment trusts and the low correlation between the stock market. In fact, more than the stock market, REITs and other asset correlation is low, while the Aibo Sen partnership (Ibbotson Associates) study also showed that in recent years, these correlation declining trend, according to portfolio theory , adding that in the portfolio of assets, will undoubtedly reduce the overall portfolio risk level. Comprehensive analysis of the characteristics of real estate investment trusts, the combination of China's current reality, this paper considers the introduction and development of our country at this stage, real estate investment trusts for the whole of China's real estate industry's healthy development of the financial system has a positive meaning. First, real estate investment trusts in the world, other countries, has long, it is more mature real estate financing. We can learn from the development experience of other countries, selective introduction of Real Estate Investment Trusts, which broaden the financing channels of China's real estate market, rely on bank loans to change a single mode of financing, banking and financial institutions to effectively disperse risks, set up to promote our country financial system more stable and healthy development. Secondly, the development of real estate investment trusts can promote China's real estate companies to abandon the traditional \In addition, after the introduction of real estate investment trusts, real estate property in the project is divided into many mutual funds units, each unit value is lower, the common people according to their own funds to purchase a certain number of units, plus on real estate investment trusts in the capital markets transactions. Therefore, this property occupies a pattern, enhance the liquidity of real estate, which greatly facilitates real estate transactions, and thus help to promote the real estate market and the capital market prosperity and development. Finally, the development of real estate investment trusts can enrich investment products, to meet the needs of investors in the capital market. At present China's capital market, the lack of investment products, investment products in the structure there are two major drawbacks: First, the risk structure upside down, high-risk species predominate. 80% higher risk of equity investment products, 20% are all kinds of illiquid bonds, two single species is a low-risk products and illiquid. These two defects, making investors long-term stable investment needs can not be met, greatly hindered the healthy development of the capital market. As the real estate investment trusts and other assets have a smaller correlation. Thus, REITs can be configured as an asset when investors rich portfolio risk diversification factor, to meet investors' risk-return requirements. From the above analysis shows that real estate investment trusts real estate development in China is significant, this paper, on the current situation of China's real estate market analysis, real estate investment trusts from the basic concepts, classification and characteristics, combining the development of the United States and Hong Kong experience in real estate investment trusts, real estate investment trusts for the development of our country's legal system construction funds and mode selection conducted in-depth discussion.
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