Abstract: The analysis of the return to capital in different periods in real-estate perspective shows that the investment of real estate is inefficient which lower the return on capital investment. The high profits of real estate derive from the highly leveraged funds. The adverse effects caused by overdevelopment of the real estate are over time more and more obvious especially after 2003. The rising of return to capital except for real-estate industry and the high return to real-estate industry explain vast international capitals pouring into China. The real estate investment and return on capital relationship test show that stimulating effect of real-estate investment on the economy exists only in the year, and the greater volatility of long-term effects exists. In addition, the return to provincial capitals shows less convergence compared with that including real-estate industry, which means the overdevelopment of real-estate industry weakens the degree of the optimal allocation of resources, and hinders sustainable economic development.