Sex and Selling: Agent Gender and Bargaining Power in the Resale Housing Market

Duong T Pham,Geoffrey K Turnbull,Bennie D Waller

doi:10.1007/s11146-020-09811-3

Abstract

This paper uses a search model with Nash bargaining to identify various channels through which agent gender affects selling price and selling time in the resale market for houses. The theory is used in conjunction with the empirical model to infer agent bargaining power when dealing with the same or opposite sex agents on the other side of the transaction. The results reveal that sellers set higher listing prices when working with male agents, a pattern consistent with sellers’ ex ante beliefs that male agents enjoy greater expected bargaining power. Ex post agent bargaining power varies by sex and their role in the transaction. Female agents assisting buyers have stronger bargaining power when facing male listing agents than when facing female agents in rising or falling markets. The ex post bargaining power of male selling agents assisting buyers appears to be generally weaker than that of female listing agents.

Highlights

Women play important roles in real estate; the National Association of Realtors member profiles regularly report that a majority of Realtors are female
We report the coefficient estimate for each pairing of agent gender (DUAL MALE = 1 if a male agent representing both sides, DUAL FEMALE = 1 of a female agent representing both sides, Listing agent females and selling agent males (LAFSAM) = 1 if female listing and male selling agent, listing agent male and selling agent females (LAMSAF) = 1 if male listing and female selling agent, LAMSAM = 1 if male listing and male selling agent, and LAFSAF = 1 if female listing and female selling agent – our base category) in Model 2, Model 3 and Model 4
We report the coefficient estimate for each pairing of agent gender (DUAL MALE = 1 if a male agent representing both sides, DUAL FEMALE = 1 of a female agent representing both sides, LAFSAM = 1 if female listing and male selling agent, LAMSAF = 1 if male listing and female selling agent, LAMSAM = 1 if male listing and male selling agent, and LAFSAF = 1 if female listing and female selling agent – our base category) for the full sample period (1999–2009)

Summary

Introduction

Women play important roles in real estate; the National Association of Realtors member profiles regularly report that a majority of Realtors are female. Closest to our research is the strand of the real estate literature that examines the impact of agent gender on the outcomes of individual transactions, generally by introducing an indicator of agent sex into the hedonic price framework. Our paper uses the theoretical search-bargaining model with the empirical simultaneous price-liquidity model derived from the theory and uses the empirical estimates coupled with the theoretical search model to compare bargaining power of the agents on each side of the real estate transaction Another recent study by Andersen et al (2020) uses real estate transactions to investigate negotiation differences between men and women. Unlike Andersen et al (2020), our study centers on real estate agents’ bargaining power revealed by transactions outcomes, allowing bargaining power to vary with their roles as listing or selling agents as well as the sex of the counterparty agent

A Model of Search and Bargaining

Findings

Conclusion