Abstract: The rise of house price in China′s real estate market is closely related to land finance and credit expansion. This paper takes China Residential House Price Index in 100 Cities(HPI-100) as the research object and uses the panel data model from 2010 to 2016 to analyze the impact of land finance, credit expansion and their interaction terms on house price. The study finds that land finance is the root cause of the rise of house price in China,and the expansion of credit scale mainly affects the rise of housing prices through land finance: the faster the expansion of credit scale, the greater the impact of land finance on the rise of housing prices.Among them, the impact of land finance on the rise of housing prices is far greater in the first-and second-tier cities than in the third-and fourth-tier cities. Local governments should take the reform in the financial field as a breakthrough to solve the problem of high housing prices, and reduce the motivation of local governments to obtain land revenue and land financing; at the same time, reduce the multiplier effect of credit funds, and strictly prevent credit funds from flowing into local financing platforms through various forms.

Key words: urban housing price rise, land finance, credit expansion, interactive items, instrumental variables