Using a non-causality approach based on the conventional approach of Fama and Schwert (1977), cointegration method in Johansen (1988), and autoregressive distributed lag (ARDL) cointegration technique in Pesaran et al. (2001) and Granger et al. (2000), this study examines the inflation hedging effectiveness of residential property in three of the largest emerging market (EM) economies: China, India and Russia. While the results of the Fama and Schwert (1977) regression indicate that residential properties in China and Russia provide a short-term hedge against expected inflation, this is not the case for those in India against both expected and unexpected inflation. Consistent with the results of the developed economies, the Johansen and ARDL cointegration results provide strong evidence to support the hypothesis that inflation and the residential properties in the three largest EM economies are cointegrated. This implies that the residential properties in these three countries provide a long-term hedge for inflation. In addition, the causality results show evidence that inflation has a lead effect on residential property prices in India over the long run. The empirical results of the cointegration tests confirm that residential properties could be considered as a reliable hedge against inflation for EMs in the long run and suggest that investors should overweigh their investment in residential property assets during periods of persistent inflation in EMs.
{"title":"International Real Estate Review","authors":"H. Lee","doi":"10.53383/100321","DOIUrl":"https://doi.org/10.53383/100321","url":null,"abstract":"Using a non-causality approach based on the conventional approach of Fama and Schwert (1977), cointegration method in Johansen (1988), and autoregressive distributed lag (ARDL) cointegration technique in Pesaran et al. (2001) and Granger et al. (2000), this study examines the inflation hedging effectiveness of residential property in three of the largest emerging market (EM) economies: China, India and Russia. While the results of the Fama and Schwert (1977) regression indicate that residential properties in China and Russia provide a short-term hedge against expected inflation, this is not the case for those in India against both expected and unexpected inflation. Consistent with the results of the developed economies, the Johansen and ARDL cointegration results provide strong evidence to support the hypothesis that inflation and the residential properties in the three largest EM economies are cointegrated. This implies that the residential properties in these three countries provide a long-term hedge for inflation. In addition, the causality results show evidence that inflation has a lead effect on residential property prices in India over the long run. The empirical results of the cointegration tests confirm that residential properties could be considered as a reliable hedge against inflation for EMs in the long run and suggest that investors should overweigh their investment in residential property assets during periods of persistent inflation in EMs.","PeriodicalId":44050,"journal":{"name":"International Real Estate Review","volume":"7 1","pages":""},"PeriodicalIF":0.7,"publicationDate":"2021-06-30","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"76235487","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
This paper investigates two types of housing wealth effects: conventional housing wealth and collateral. We incorporate home equity extraction (HEE) and the influence of mortgage liberalization into the model in Campbell and Mankiw (1989). Based on U.S. data during the 1977Q1–2019Q4, our empirical results suggest that consumption is remarkably influenced by the use of HEE, rather than home equity. Furthermore, the rapid expansion of mortgage securitization significantly amplifies the collateral effect. Conditional on the use of HEE and the share of non-bank mortgage holdings, housing wealth has an average marginal propensity to consume (MPC) of 0.84 cents and a maximum MPC of 6.06 cents. In 2007, when market-based mortgage pools and issuers of asset-backed securities held more than 60% of home mortgages, the HEE shock explained for over 50% of the forecasting variance of consumption growth. The results provide evidence that with a focus on collateral value, lenders allow more equity withdrawal, which leads to higher consumption.
{"title":"International Real Estate Review","authors":"Lingxiao Li, B. Zhu","doi":"10.53383/100309","DOIUrl":"https://doi.org/10.53383/100309","url":null,"abstract":"This paper investigates two types of housing wealth effects: conventional housing wealth and collateral. We incorporate home equity extraction (HEE) and the influence of mortgage liberalization into the model in Campbell and Mankiw (1989). Based on U.S. data during the 1977Q1–2019Q4, our empirical results suggest that consumption is remarkably influenced by the use of HEE, rather than home equity. Furthermore, the rapid expansion of mortgage securitization significantly amplifies the collateral effect. Conditional on the use of HEE and the share of non-bank mortgage holdings, housing wealth has an average marginal propensity to consume (MPC) of 0.84 cents and a maximum MPC of 6.06 cents. In 2007, when market-based mortgage pools and issuers of asset-backed securities held more than 60% of home mortgages, the HEE shock explained for over 50% of the forecasting variance of consumption growth. The results provide evidence that with a focus on collateral value, lenders allow more equity withdrawal, which leads to higher consumption.","PeriodicalId":44050,"journal":{"name":"International Real Estate Review","volume":"25 10 1","pages":""},"PeriodicalIF":0.7,"publicationDate":"2020-12-31","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"82688777","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Most existing studies on the behavior of real estate appraisers focus on the issues around the independence of the appraiser. This study uses a questionnaire to measure the objectivity of real estate appraisers which involves six indicators related to the appraisal process, and divides the factors that affect the objectivity of real estate appraisers in Taiwan into four categories, namely, the opinion of the appraiser regarding the future development of the real estate appraisal industry, current real estate appraisal approaches and behavior of other appraisers, and the characteristics of real estate appraisers and their firms. The empirical results reveal that the income of appraisers relative to other professionals and public opinion in relation to the fairness of real estate appraisers are the two most important factors that affect the objectivity of real estate appraisers. Furthermore, the work experience of the appraiser, total revenue of the real estate appraisal firm, and independence of the final appraisal result all significantly and positively affect the objectivity of the real estate appraisers, and the awareness of a lack of appraisers in the market significantly and negatively affects their objectivity. These findings are helpful to the healthy development of real estate appraisal and its related industries.
{"title":"International Real Estate Review","authors":"K. Chen, C. Peng, Mei-Hsing Lee","doi":"10.53383/100311","DOIUrl":"https://doi.org/10.53383/100311","url":null,"abstract":"Most existing studies on the behavior of real estate appraisers focus on the issues around the independence of the appraiser. This study uses a questionnaire to measure the objectivity of real estate appraisers which involves six indicators related to the appraisal process, and divides the factors that affect the objectivity of real estate appraisers in Taiwan into four categories, namely, the opinion of the appraiser regarding the future development of the real estate appraisal industry, current real estate appraisal approaches and behavior of other appraisers, and the characteristics of real estate appraisers and their firms. The empirical results reveal that the income of appraisers relative to other professionals and public opinion in relation to the fairness of real estate appraisers are the two most important factors that affect the objectivity of real estate appraisers. Furthermore, the work experience of the appraiser, total revenue of the real estate appraisal firm, and independence of the final appraisal result all significantly and positively affect the objectivity of the real estate appraisers, and the awareness of a lack of appraisers in the market significantly and negatively affects their objectivity. These findings are helpful to the healthy development of real estate appraisal and its related industries.","PeriodicalId":44050,"journal":{"name":"International Real Estate Review","volume":"375 1","pages":""},"PeriodicalIF":0.7,"publicationDate":"2020-12-31","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"76177179","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Fathali Firoozi, Abolhassan Jalilvand, D. Lien, Mikiko Oliver
Population aging and its economic impact have been receiving increasing attention in many countries around the world. This study offers an analysis of the impact of aging on the housing prices in Singapore relative to the U.S. as the benchmark. The study uses semiannual series over the period of 1998 to 2019 with the age subgroups organized in 5-year intervals. The literature contains conflicting arguments on the impacts of aging on housing prices. Based on observations made for Singapore and the U.S., this study supports the arguments that the elderly part of a population has a damping effect on housing prices. A novel behavioral divergence between Singapore and the U.S. emerges when the analysis focuses on the impact of the finer age subgroups on housing prices in the two countries. The “turning age”, which is defined as the approximate cut-off age when the impact of aging on housing prices turns from positive to negative, is approximately 55 years old in Singapore and 60 years old in the U.S.
{"title":"International Real Estate Review","authors":"Fathali Firoozi, Abolhassan Jalilvand, D. Lien, Mikiko Oliver","doi":"10.53383/100310","DOIUrl":"https://doi.org/10.53383/100310","url":null,"abstract":"Population aging and its economic impact have been receiving increasing attention in many countries around the world. This study offers an analysis of the impact of aging on the housing prices in Singapore relative to the U.S. as the benchmark. The study uses semiannual series over the period of 1998 to 2019 with the age subgroups organized in 5-year intervals. The literature contains conflicting arguments on the impacts of aging on housing prices. Based on observations made for Singapore and the U.S., this study supports the arguments that the elderly part of a population has a damping effect on housing prices. A novel behavioral divergence between Singapore and the U.S. emerges when the analysis focuses on the impact of the finer age subgroups on housing prices in the two countries. The “turning age”, which is defined as the approximate cut-off age when the impact of aging on housing prices turns from positive to negative, is approximately 55 years old in Singapore and 60 years old in the U.S.","PeriodicalId":44050,"journal":{"name":"International Real Estate Review","volume":"51 1","pages":""},"PeriodicalIF":0.7,"publicationDate":"2020-12-31","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"81304737","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Rosli Said, R. A. Majid, Koh Chuan Pey, O. Olanrele
The city of Georgetown, Malaysia was listed as a World Heritage Site by the United Nations Educational, Scientific and Cultural Organisation (UNESCO) in 2008 due to the diverse cultural and tourism activities. The listing has brought about an impact to the heritage properties in Malaysia. Since then, the volume of business activities has increased dramatically with a positive demand for heritage properties. This scenario has increased competition in commercial activities and business owners have struggled to offer their best products to tourists, both local and foreign. However, while investors and traders thrive to locate their businesses in heritage properties, some restrictions and externalities have influenced their activities. Among the significant factors that have influenced such activities, there is the Special Area Plan which restricts renovations and conservations, building condition and building price. Therefore, the purpose of this paper is to assess the sustainability of businesses located in the heritage properties. Eighteen criteria (factors) are identified and assessed to determine the best sustainable areas in the city and the Complex Proportional Analysis (COPRAS) is utilised as the best method to assess the issue .The findings show that each alternative has its unique characteristics that support the sustainability of businesses that occupy the heritage properties. This is the first paper of its kind to assess the sustainability of business activities that are occupying the heritage properties in Malaysia.
{"title":"International Real Estate Review","authors":"Rosli Said, R. A. Majid, Koh Chuan Pey, O. Olanrele","doi":"10.53383/100313","DOIUrl":"https://doi.org/10.53383/100313","url":null,"abstract":"The city of Georgetown, Malaysia was listed as a World Heritage Site by the United Nations Educational, Scientific and Cultural Organisation (UNESCO) in 2008 due to the diverse cultural and tourism activities. The listing has brought about an impact to the heritage properties in Malaysia. Since then, the volume of business activities has increased dramatically with a positive demand for heritage properties. This scenario has increased competition in commercial activities and business owners have struggled to offer their best products to tourists, both local and foreign. However, while investors and traders thrive to locate their businesses in heritage properties, some restrictions and externalities have influenced their activities. Among the significant factors that have influenced such activities, there is the Special Area Plan which restricts renovations and conservations, building condition and building price. Therefore, the purpose of this paper is to assess the sustainability of businesses located in the heritage properties. Eighteen criteria (factors) are identified and assessed to determine the best sustainable areas in the city and the Complex Proportional Analysis (COPRAS) is utilised as the best method to assess the issue .The findings show that each alternative has its unique characteristics that support the sustainability of businesses that occupy the heritage properties. This is the first paper of its kind to assess the sustainability of business activities that are occupying the heritage properties in Malaysia.","PeriodicalId":44050,"journal":{"name":"International Real Estate Review","volume":"29 1","pages":""},"PeriodicalIF":0.7,"publicationDate":"2020-12-31","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"75117209","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
In recent years, China has uniquely implemented various policies to control housing prices, particularly its property- purchasing limitation policy. This research proposes a vector autoregression (VAR) model with likelihood-ratio (LR) tests to examine the effects of such a policy on housing prices at the national, provincial and city levels in China, with the use of monthly data from 2002 to 2013. The results show that at the national level, the effect of the policy is very significant, and the impact on housing prices is far greater than monetary and credit policies. However, the policy is not applicable at the provincial level. The policy has a significant role at the city level in first-tier cities, but no significant effect in second- tier cities. Overall, property-purchasing limitations inhibit the growth of housing prices to some extent, and the effects show strong regional characteristics, especially at the city level. Policymakers should therefore take into account regional characteristics in the formulation and implementation of a property-purchasing limitation policy.
{"title":"International Real Estate Review","authors":"H. An, Qianmiao Zou, Ying Zhang","doi":"10.53383/100280","DOIUrl":"https://doi.org/10.53383/100280","url":null,"abstract":"In recent years, China has uniquely implemented various policies to control housing prices, particularly its property- purchasing limitation policy. This research proposes a vector autoregression (VAR) model with likelihood-ratio (LR) tests to examine the effects of such a policy on housing prices at the national, provincial and city levels in China, with the use of monthly data from 2002 to 2013. The results show that at the national level, the effect of the policy is very significant, and the impact on housing prices is far greater than monetary and credit policies. However, the policy is not applicable at the provincial level. The policy has a significant role at the city level in first-tier cities, but no significant effect in second- tier cities. Overall, property-purchasing limitations inhibit the growth of housing prices to some extent, and the effects show strong regional characteristics, especially at the city level. Policymakers should therefore take into account regional characteristics in the formulation and implementation of a property-purchasing limitation policy.","PeriodicalId":44050,"journal":{"name":"International Real Estate Review","volume":"1 1","pages":""},"PeriodicalIF":0.7,"publicationDate":"2019-06-30","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"77225902","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Currency depreciation is said to affect domestic output in either direction, depending on the relative strength of its impact on next exports and the cost of imported inputs. Since increased net exports and eventual economic growth affect the demand for housing and increased cost of imported materials that are used in housing construction affects the supply of housing, we assume that currency depreciation could have an impact on housing output. We test our assumption by using time-series data from each of the states in the U.S. and show that when a linear model is estimated, dollar depreciation has short-run effects in 41 states and long-run effects in only three states. However, when dollar depreciation is separated from appreciation and a nonlinear model is estimated, we find short-run asymmetric effects in all of the states and long-run asymmetric effects in 32 states. Additional analysis reveals that while dollar depreciation increases housing output in 10 states, dollar appreciation hurts the output in 11 states, thus supporting the expansionary depreciation of the dollar in the U.S. housing market.
{"title":"International Real Estate Review","authors":"Mohsen Bahmani‐Oskooee, S. Ghodsi","doi":"10.53383/100281","DOIUrl":"https://doi.org/10.53383/100281","url":null,"abstract":"Currency depreciation is said to affect domestic output in either direction, depending on the relative strength of its impact on next exports and the cost of imported inputs. Since increased net exports and eventual economic growth affect the demand for housing and increased cost of imported materials that are used in housing construction affects the supply of housing, we assume that currency depreciation could have an impact on housing output. We test our assumption by using time-series data from each of the states in the U.S. and show that when a linear model is estimated, dollar depreciation has short-run effects in 41 states and long-run effects in only three states. However, when dollar depreciation is separated from appreciation and a nonlinear model is estimated, we find short-run asymmetric effects in all of the states and long-run asymmetric effects in 32 states. Additional analysis reveals that while dollar depreciation increases housing output in 10 states, dollar appreciation hurts the output in 11 states, thus supporting the expansionary depreciation of the dollar in the U.S. housing market.","PeriodicalId":44050,"journal":{"name":"International Real Estate Review","volume":"31 1","pages":""},"PeriodicalIF":0.7,"publicationDate":"2019-06-30","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"74554961","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
The government of Singapore imposed two rounds of demand restrictions in 2010 and 2013, respectively, which prohibited private housing owners from concurrently owning both a private housing unit and a public housing flat. These restrictions curb speculative and investment activities, but do not deter public housing owners from upgrading to private housing. Using private housing transaction data between 2005 and 2015, we find that the demand shocks in 2010 and 2013 caused a significant reduction of 2.4% and 1.8% in the transaction prices of investors relative to those of the owners, respectively, ceteris paribus. Larger price declines are observed in investment sales in the submarkets, such as the core central region, and resale, moderate-to-high end, and large unit markets. The results show that when the housing market is volatile, risk averse investors are found, and owners move up the ¡§quality¡¨ curve by upgrading their home.
{"title":"International Real Estate Review","authors":"Mi Diao, Yi Fan, T. Sing","doi":"10.53383/100278","DOIUrl":"https://doi.org/10.53383/100278","url":null,"abstract":"The government of Singapore imposed two rounds of demand restrictions in 2010 and 2013, respectively, which prohibited private housing owners from concurrently owning both a private housing unit and a public housing flat. These restrictions curb speculative and investment activities, but do not deter public housing owners from upgrading to private housing. Using private housing transaction data between 2005 and 2015, we find that the demand shocks in 2010 and 2013 caused a significant reduction of 2.4% and 1.8% in the transaction prices of investors relative to those of the owners, respectively, ceteris paribus. Larger price declines are observed in investment sales in the submarkets, such as the core central region, and resale, moderate-to-high end, and large unit markets. The results show that when the housing market is volatile, risk averse investors are found, and owners move up the ¡§quality¡¨ curve by upgrading their home.","PeriodicalId":44050,"journal":{"name":"International Real Estate Review","volume":"79 1","pages":""},"PeriodicalIF":0.7,"publicationDate":"2019-06-30","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"83782540","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Reverse mortgages generally have open maturity dates. The variability of the exact termination time of a mortgage is one of the most important risks faced by the lenders and mortgage insurers. This paper analyzes the termination experience of reverse mortgages in the United States (US). We find that reverse mortgages can be terminated by three distinct events: refinancing, mortality and mobility. Using the Federal Housing Administration (FHA) insured Home Equity Conversion Mortgage (HECM) loan data, we estimate the probability of the termination through individual events. The results show that refinance termination and other termination events are driven by different factors. Refinances are mainly driven by macroeconomic conditions, such as the appreciation of the house value and decline in interest rate, and usually done in the beginning years of the loan origination. Mortality terminations follow closely the US mortality tables, which are governed by age and gender. Mobility termination shares a similar pattern with mortality termination, especially in the later years of the loan life. Meanwhile, the initial cash drawdown pattern has significant but different impacts on each type of termination. By separating refinance termination from the two other types of terminations, we show that refinance termination slows down when the interest rate starts to rise. Without separating refinance termination, HECM investors could over-project the number of future HECM terminations in a rising interest rate scenario and result in loss of funds.
{"title":"International Real Estate Review","authors":"Shan (Victor) Jiang, Chen L. Miller","doi":"10.53383/100279","DOIUrl":"https://doi.org/10.53383/100279","url":null,"abstract":"Reverse mortgages generally have open maturity dates. The variability of the exact termination time of a mortgage is one of the most important risks faced by the lenders and mortgage insurers. This paper analyzes the termination experience of reverse mortgages in the United States (US). We find that reverse mortgages can be terminated by three distinct events: refinancing, mortality and mobility. Using the Federal Housing Administration (FHA) insured Home Equity Conversion Mortgage (HECM) loan data, we estimate the probability of the termination through individual events. The results show that refinance termination and other termination events are driven by different factors. Refinances are mainly driven by macroeconomic conditions, such as the appreciation of the house value and decline in interest rate, and usually done in the beginning years of the loan origination. Mortality terminations follow closely the US mortality tables, which are governed by age and gender. Mobility termination shares a similar pattern with mortality termination, especially in the later years of the loan life. Meanwhile, the initial cash drawdown pattern has significant but different impacts on each type of termination. By separating refinance termination from the two other types of terminations, we show that refinance termination slows down when the interest rate starts to rise. Without separating refinance termination, HECM investors could over-project the number of future HECM terminations in a rising interest rate scenario and result in loss of funds.","PeriodicalId":44050,"journal":{"name":"International Real Estate Review","volume":"19 1","pages":""},"PeriodicalIF":0.7,"publicationDate":"2019-06-30","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"90230148","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
We develop a simple framework to assess the position of office prices with respect to their fundamentals. Applying the model to France, we show that a constrained office supply and low interest rates mainly explain for the high and increasing trend of office prices in recent years. Nonetheless, we find that the office market is only slightly overvalued in France in late 2017: the deviation of office prices with respect to their fundamental determinants is between 0% and 10%, thus indicating that the market is close to fair value.
{"title":"International Real Estate Review","authors":"J. Coffinet, Etienne Kintzler","doi":"10.53383/100282","DOIUrl":"https://doi.org/10.53383/100282","url":null,"abstract":"We develop a simple framework to assess the position of office prices with respect to their fundamentals. Applying the model to France, we show that a constrained office supply and low interest rates mainly explain for the high and increasing trend of office prices in recent years. Nonetheless, we find that the office market is only slightly overvalued in France in late 2017: the deviation of office prices with respect to their fundamental determinants is between 0% and 10%, thus indicating that the market is close to fair value.","PeriodicalId":44050,"journal":{"name":"International Real Estate Review","volume":"51 1","pages":""},"PeriodicalIF":0.7,"publicationDate":"2019-06-30","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"75792495","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
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