Property Investment Research Articles

Suppose FIRPTA Was Repealed

This article argues, as others have before, that the Foreign Investment in Real Property Tax Act of 1980 (or “FIRPTA”), or at least the provisions of FIRPTA relating to “United States real property holding corporations,” should be repealed. Their enactment in 1980 was misguided and in any event changes in the Internal Revenue Code since then have made the provisions obsolete. But if FIRPTA is repealed, in whole or in part, the article argues that the lack of parity between foreign investment in real property that is made directly or through a partnership, on the one hand, and foreign investment in a real estate investment trust (or a regulated investment company that invests in shares of real estate investment trusts) should be dealt with. Otherwise, repeal will exacerbate existing distortions (which were already pushed further by FIRPTA) resulting from the choice of the entity used to make an investment in US real property. The article also suggests that repeal of FIRPTA would provide an opportunity to look at the taxation of foreign investment in the United States more broadly and in particular the rules that tax income from U.S. real property. The tax treatment of inward investment is a generally neglected subject.The article concludes by arguing against legislation that would keepthe FIRPTA rules and simply expand provisions of present law that favor foreign investment through real estate investment trusts, such as the Real Estate Jobs and Investment Act of 2011.

Infrastructure Condition Model as a Measure of Property Investment Performance in Ilorin; The Contemporary Approach

Infrastructure stands out as one of the indicators of an ideal urban economic development and its role creates attraction for all forms of investments including real estate investment. This study examined the infrastructure condition model; which serves as a measure of property investment returns in Ilorin; the Kwara State capital. The study employed an exploratory research design. The sample frame was 1,228 and a model was used given 984 as sample size, and these questionnaires were administered through stratified sampling technique and only 664 questionnaires were completed and returned, representing 67% of the total sample size. The study utilised both descriptive and inferential statistical methods of data analysis. The result of descriptive analysis of the performance of property investment revealed that a comparable average return across the study areas in Ilorin differed; ranging from 10% to 25%. The result of the infrastructure condition index developed through the scoring analysis based on descriptive modelling revealed a relative condition index of between 60% and 61% in Ilorin. The result of an inferential method using correlation to establish the relationship between infrastructure condition index and property investment return revealed that 7(seven) infrastructure maintained perfect significant correlation with property investment performance at p-value less than 0.05 level of significance. The result of regression modelling revealed that 60.4% variation in property performance is explained by seven infrastructures. Therefore, the study concluded that the performance of property investment is impressive in the areas where there is a frequent market transaction with better infrastructure conditions which is strongly influenced by constant potable water with a correct system of road networks, security, drainage system and streetlight. The study recommends that real estate investors wishing to embark on real estate investment projects should make it a point of duty to be conversant with the functionality of infrastructure in human sustainability and real estate investment growth.

Remarkable pain control and functional improvement in clubfeet-related ankle osteoarthritis post autologous expanded mesenchymal stem cell therapy

Ankle joint osteoarthritis (OA) is not as common as knee and hip OA but it causes a significant socioeconomic burden in society. The causes of ankle OA could be primary or secondary to previous ankle trauma, inflammatory arthritis like rheumatoid arthritis, avascular necrosis, post-infectious, clubfoot, and other rare causes. Ankle OA is hard to treat conservatively. Limited options, including physiotherapy, supportive custom-made braces, weight reduction, and anti-inflammatory medicines. Standard surgical options are joint arthrodesis and ankle replacement. Arthrodesis can limit the movement of talar and subtalar joints, making it difficult to be accepted by athletes who require functional joint movement. Ankle replacement might last between five and ten years and is sometimes technically challenging. Herein we report a case of a seventy-one-year-old male property investor. His past medical history of bilateral congenital clubfeet with the left foot more affected and pointed backward required three surgeries at the age of two through five to align the foot in the correct direction, and his left ankle was fused. In his mid-forties, he had mild ankles discomfort which was managed by suitable orthotics, despite the ankle pathology he enjoys various recreational physical sports at a premium competitive level with determination. At the age of sixty-seven, his symptoms increased gradually. He was diagnosed with severe secondary severe subtalar and mild talar OA, confirmed by X-rays; by the age of seventy-one, he had significant pain and loss of ankle function to the extent he could hardly walk five steps or play any sport. He failed conservative management with various supportive orthotics and long-term anti-inflammatory medicines. He elected experimental autologous fat-derived expanded mesenchymal stem cells (MSCs) combined with platelet-rich plasma (PRP). After two doses nine months apart, he responded superbly to become pain-free. Three months after the second dose, he was able to walk normally, play sports, and intend to return to competitive table tennis, but we recommended continuing using supportive orthotics. We predict MSCs slow the progression of OA. We believe this is the future medicine to try efficiently and safely regardless of the number of booster doses given.

Culture, Wealth, Gender, Real Estate, and Consumption in China: It’s a Boy

Culture and derivative institutions affect household wealth, consumption, and property rights and ownership. Cultural factors also influence the role children play in determining household consumption and wealth accumulation, including acquisition of real property. The present study extends research on these influences by focusing on cultural norms in China. Chinese cultural norms, including indulgent care of single children, a strong preference for sons, increasing competition in the marriage market, and the importance of homeownership in marriage, suggest that the number, gender, and age of children likely affect a household’s consumption and investment behavior, especially as related to consumption and investment in real property. Using China Family Panel Studies’ (CFPS) longitudinal data, we found that, after controlling for other factors, total wealth (consumption) for households with children was 17.8% (23.5%) more than that of households without children. More interestingly, further results show that households with male children have more wealth accumulation and more expenditure on total consumption, including real estate–related expenditures, with a higher likelihood of owning additional residential real estate when compared to households with no or female children. The positive effect associated with children on household wealth is largely due to increased housing wealth, including the ownership of additional residential units. The pattern of wealth and real estate ownership follows Chinese cultural and social norms.

United Kingdom general elections and the impact on house prices

PurposeThe paper considers if house price movements in the United Kingdom (UK) can be linked to the political cycle as governments realise homeowners represent a large portion of the voter base and their voting decisions could be influenced by the magnitude and direction of house price changes. Specifically, this paper aims to investigate whether house prices behave differently before and after elections and under different political regimes.Design/methodology/approachThe paper analyses quarterly house price data from 1960 to 2018 together with data on UK parliamentary elections for the same period. Descriptive statistics and significance tests are used to analyse the impact of the political cycle on house price movements in the UK.FindingsWhile there is no evidence that house prices in the UK performed significantly differently under different political parties, the authors observed that house prices performed much better in the last year before an election compared to the first year after an election. On average, house prices increased by 5.3% per annum in the last year before an election compared to 1.3% per annum in the first year following an election.Research limitations/implicationsThe study highlights significant variations in the performance of UK house prices around election times.Practical implicationsIt is imperative that the political cycle is given adequate consideration when making residential property investment decisions.Social implicationsHouse buyers and investors in the residential property market could include the election timings as part of their decision-making process.Originality/valueThis paper represents a unique systematic examination of the influence of the political cycle on residential houses prices in the UK.

China’s extended urbanization driven by the “consumption city” in the context of financialized ecological civilization

This article seeks to address current debates on ongoing China’s urban development and makes a theoretical proposal that links financialization and ecological civilization through the perspective of the increasing role of consumption in today’s transition to an upgraded domestic economy. While both financialized land value capture and the role of quality are now fundamental to the construction of the built environment in Chinese cities, we argue that the “consumption city” refers to an economic and urban production process as well as to a societal transformation. First, the economic upgrading has gone along with a greater mobility of people travelling ever longer distances who spend their income or invest in the places they travel to rather than necessarily their places of residence or of work. To attract these consumers, whether they are residents, tourist or property investors, the quality of the living and consumption environments play a dominant role in the complex urban production and in governance, beyond the classic model of development based on the city as a production place. Simultaneously, the rising role of financialization by external households as investors raises the issue of how and to what extent the construction of consumption places has been a way for the state to further enhance the land value capture in (new or not) cities. Second, as the latest government strategy, ecological civilization is part of a social engineering process aiming to shape people’s lifestyles in terms of both their everyday consumption practices and their mindsets. The current transition aims to “civilize” citizens by enlarging the scope of urban consumers beyond the upper and middle classes to people from rural areas who are encouraged to become urban. Ecological civilization promotes a better quality of life for all, together with new outdoor and experiential activities, although this comes with a high ecological footprint.

A framework for specifying low-carbon construction materials in government procurement: A case study for concrete in a new building investment

There are numerous strategies that can be used to reduce the embodied carbon footprint of real property investments, many of which can be accomplished for no additional cost and with minimal performance impacts. This study aims to propose the incorporation of the life cycle carbon quantification into the government procurement of real property process in order to reach out to low-carbon durable and sustainable structures as a theoretical contribution. As a practical contribution, an integrated embodied carbon measurement application is developed in a building information model (BIM) environment to act as a decision making tool in a government office building as a case study. It supports updating procurement policies and procedures to request construction materials with lower embodied carbon in construction. Analysis of concrete assembly groups in the case study along with determination of volume of concrete in each assembly is conducted to devise a reasonable list of elements to be considered for low-carbon concrete compliancy based on an industry average benchmarking approach. Considering the numerous concrete vendors that supply concrete products to a given region, a novel concrete embodied carbon measurement approach is proposed where cradle-to-construction impacts were accounted for. The outcome of the proposed integrated tool showed the procurement of concrete mix design from one specific nearby facility resulted in more efficient GHG reductions and the results showed especially the significance of considering transportation impacts of delivering ready-mixed concrete elements to the project site.

Examining the Variation Between the Conventional and Contemporary Valuation of Residential Investment Properties in Lagos

Due to the interplay between the forces of demand and supply in the determination of residential property investment valuation, there is continuous increase in rental value and rent review pattern and as such, conventional valuation of residential property investment has become inappropriate as it cannot handle the problems of rental values, rental growth, impact of inflation and rent review pattern experienced in the Nigerian property market. The objectives were to determine the annual rental growth rate pattern for residential properties from 2014–2020 and ascertain the level of variation in the use of conventional and contemporary investment methods in determining the value of such real estate assets in Lagos State, Nigeria. Appropriate descriptive approach was adopted and the result showed that rental values increased within the period, rental growth followed a similar trend, rent review pattern was mostly three years, and practitioners were aware of discounted cash flow. Valuation results revealed 6.67% variation for discounted cash flow, 0% for real value model and 25% rational approach. The use of a constant income annuity in perpetuity for conventional investment method of valuation as a single income stream would result in erroneous valuation as conventional technique relies fully on comparable evidence. The contemporary techniques on the other hand integrate property as part of the larger investment community which enables estate valuers to make qualitative market valuation where there is no comparable evidence. This study therefore recommends that contemporary valuation techniques are appropriate in the market valuation of residential property investments, particularly in the market valuation of reversionary freehold.

Buying Citizenship: A Boon to District-Level House Prices in Istanbul

ABSTRACT Citizenship by investment (CBI) programs have recently garnered significant academic and media attention. Turkey introduced such a program in 2017 that offers citizenship in exchange for investment in residential property. Through the program, thousands of foreigners, mainly from the Middle East and Asia, have purchased houses, particularly in Istanbul. Foreigners’ share of total houses sold in Istanbul almost sextupled and exceeded 10% of total sales. This study estimates the short-run impact of relatively wealthy foreigners on the residential property prices in Istanbul investing to buy a Turkish passport. It finds that the Turkish CBI program positively impacts house prices by 2% in the districts, which are likely to be favored most by immigrant investors.

Guidelines for Hiring a Florida-Friendly Landscape Professional

Many residents evaluate their landscape professionals on price alone; however, quality landscaping is an investment in your property. Knowing what to look for in a landscape professional will help you get the most for your investment, ensure your yard reaches its greatest potential and protect Florida’s water and other natural resources. This new 7-page document, published by the UF/IFAS Environmental Horticulture Department, is intended to provide guidance to residents and entities such as HOA community associations when hiring a landscape professional.https://edis.ifas.ufl.edu/ep614

Performance of residential property investment returns in an emerging metropolitan area. The awareness, use and gender inequality

This study assessed the performance of residential property investment returns. To ascertain the awareness, use, and gender inequality in the usage of residential performance data by investors. The paper focuses on risk-return features of the tenement, two and three-bedroom property for investment purposes, in order to improve the understanding of the property market mechanism in Kano metropolis, Nigeria. Unraveling empirically risk-return features of residential property in the metropolitan area is unclear hence the speculative decision on residential investment is widespread. Quantitative research was employed using a questionnaire survey to obtain primary data on annual rental and capital values of residential properties from branch managers of estate firms. This data was afterward transformed into total returns and put to Phillip-Perron unit root test (stationarity). The study utilized both descriptive and inferential statistical techniques for analysis. Findings from the study show that total returns for residential property range from 6.99% to 14.44% with risk-return ranging from 20.92% to 51.54% within the property market, Badawa/GRA property has the lowest risk features hence the most secured location for residential investment, the paper also unveils that gender inequity in the usage of residential property investment performance data is high against women. It is on these findings that the study recommended Badawi/GRA property market for risk-averse investors, persistent sensitization program and incentives (reduction in service charge) targeting women in the property market is encouraged.

Examination of the Trend of Rental Values of Bungalows in Selected Areas of Benin City

Bungalows are types of residential properties that provide a detached single unit of accommodation basically for family units and provide rental value returns to investors who develop them. However, studying the trend of rental values from such investments is of concern to the investors as it would help them appreciate its viability. The aim of this study is to analyze the trend of rental values of Bungalows in selected areas of Benin City comprising; GRA, Sapele road, Airport road, Ekenwan, Siluko, Ugbowo, Sakponba road, Ikpoba Hill and Aduwawa, in order to determine the growth model and statistical significance of their variations within each area between 2011 and 2020. The research methodology employed was the survey research design. Responses were retrieved from Estate Surveying and Valuation Firms involved in property management in Benin. Data retrieved were analyzed using Tables, Graph, Trend analysis and One-way ANOVA. The study revealed that the trend of rental values of Bungalows indicates a steady increase over a period of time and that there is significant variation of rental values of Bungalows in the selected locations. It was therefore concluded that the trends and variations could be attributed to the size of the property, facilities available, neighbourhood characteristics, etc, and recommended that intending investors should consider such factors before delving into investing in Bungalow residential property investment in Benin City in order to enjoy maximum rental return.

Evictions, Foreclosures, and Global Housing Speculation in Palma, Spain

Over the last two decades, the property bubble and the subsequent economic crisis and post-crisis policies have heightened urban inequalities, mainly in cities in southern Europe. The gaps between social classes have widened with the configuration of new urban spaces characterized by segregation and exclusion. Palma is the capital of one of the top tourist destinations in the Mediterranean (the Balearic Islands) and it is usually regarded as a successful tourism model and a land of opportunity for property investors. Nevertheless, serious problems of inequality exist in the city. The centre of this dual city is split between a process of spreading gentrification and the urban blight of its poor neighbourhoods. Son Gotleu is a particular case in point. The neighbourhood is home to a large number of social housing blocks (1960s) with residents from mostly migrant backgrounds. Within a global context of new redefined rent-seeking mechanisms, this article analysed impoverishment in Son Gotleu, based on three variables associated with housing: evictions, foreclosures and the property market. Our study shows that evictions were a determining feature of impoverishment, linked to the emergence of new speculative investment interests. Indeed, investment funds are very probably the most influential urban agents today.

Editorial – Property investment – What is it worth?

Editorial – Property investment – What is it worth?

Relevance of supplementary fair value disclosures under market uncertainty: effects on audit fees and investors’ pricing

PurposeConcerns relating to the representational faithfulness and, consequently, the relevance of fair value (FV) estimates are likely to be heightened in the wake of market uncertainty caused by the COVID pandemic. Therefore, this paper aims to study the relevance of supplementary disclosures intended to improve the representational faithfulness of FV estimates by examining their impacts on audit fees and investors’ valuation of FV adjustments in the uncertain market condition of 2020.Design/methodology/approachThe sample is comprising Australian real estate firms. The authors develop both weighted and unweighted disclosure indices based on supplementary disclosures related to Level 3 FVs under IFRS 13 Fair Value Measurement. The authors measure the levels of disclosure by the sample firms based on these indices from 2018 to 2020 and ascertain their effects on audit fees and the market value of FV adjustments on investment properties.FindingsThe authors find that real estate firms increased supplementary FV disclosures during 2020. The authors document a negative association between supplementary disclosures and audit fees, although the authors find no incremental impact of disclosures on audit fees during the pandemic. Additionally, the authors find that investors’ pricing of FV adjustments increased with the increase in disclosures during the market uncertainty of 2020, while in the pre-uncertainty period, their pricing influence was not significant.Originality/valueThe findings extend the understanding of the role of supplementary disclosures on Level 3 investment properties in mitigating the perceived audit risk for auditors and the faithful representation concerns for investors in a distressed market environment.

Property Rights and Urban Form

How do the different elements in the standard bundle of property rights, including those of possession and transfer, influence the shape of cities? This paper incorporates insecure property rights into a standard model of urban land prices and density, and makes predictions about investment in land and property, informality, and the efficiency of land use. Our empirical analysis links data on institutions for land titling and transfer with multiple urban outcomes, in 190 countries. The evidence is generally consistent with the model’s predictions, and more broadly with the Demsetz’s (1967) approach to property rights institutions. Indeed, we document world-wide improvements in the quality of institutions facilitating property transfer over time.

Effect of Residential Property Location on Tenants’ Willingness to Pay in Akure, Nigeria

The study examined the effect of residential property location on tenants’ willingness to pay in Akure with a view to providing adequate information that would help in residential property investment decision making in the study area. A structured questionnaire was used in collecting data from the tenants of residential properties within the selected areas. Questionnaires were distributed to Two Hundred and Eighty Two Tenants of residential properties that were selected via simple random sampling method. One hundred and ninety six (196) were retrieved representing 69.50% of the sample selected. Data collected were analyzed using contingent valuation and binary logistic regression model. Result of data obtained revealed that 57.14% of the respondents responded positive willingness to pay for residential property location while 42.86% reported zero willingness to pay for residential property location. The study further showed the bid amount tenants were willing to pay for various improvements in the residential property location, 49.11% of the respondents are willing to pay between 5-10% above the current rent for traffic noise reduction. For provision of infrastructure such as good road, electricity and water supply, 30.36% of the respondents are willing to pay between 5-10% above the current rent. Factors that influence their willingness to pay for residential location includes length of stay in the property, marital status, age, occupation, income, rent, nearness to place of work, security, electricity supply and water supply amongst others. It was recommended that real estate property owners and developers should consider location critically before embarking on residential property building projects in order to yield optimum returns. Keywords: Residential Properties, Residential Properties Location, Tenants, Willingness to pay. DOI: 10.7176/EJBM/14-3-03 Publication date: February 28 th 2022

AN EMPIRICAL STUDY ON THE MOTIVATION OF CHOOSING FAIR VALUE MEASUREMENT MODEL IN INVESTMENT PROPERTY

This paper selects all non-ST listed companies in the A-share market with investment properties in the time period from 2015 to 2019 as the initial research sample and employs a binary logistic regression model to empirically examine the specific motivations of companies’ management in choosing the fair value measurement model. Our results show that the level of enterprise fair value measurement has a significant positive impact on the increase in net profit, the improvement in the ability of debt financing, the increase in total assets, the increase in the level of executive compensation and the increase in enterprise value. However, it also enhances the level of enterprise earnings management and leads to an increase in speculations by enterprise executives. In the meantime, the higher the level of fair value measurement of investment properties, the greater the fluctuations in profit, total assets and debt financing. This indicates that the adoption of the fair value measurement model for investment properties will increase the instability of profit, total assets and debt financing of enterprises. The majority of enterprises currently adopt the fair value measurement model in relation to the listed investment properties for opportunistic motives, as a way of presenting an improved quality of enterprises’ financial disclosure to both outside investors and the market overall, while catering for market developments and external regulation.

Adoption the international accounting and financial reporting standards to the Measurement of Municipal Lands and their Reflection on the Financial Statements ( An applied Study in the Municipality of Najaf )

The research aimed to apply the international accounting and financial reporting standards to the measurement of municipal lands and its impact on the financial statements. The problem of the research is represented by the acquisition of land by the municipalities without cash payment, which led to the difficulty of knowing the real cost of land because of shortcomings of the municipal accounting system in dealing with this situation. The system did not include the accounting procedures for the lands' investment that meet the conditions of classification as investment properties. The research reached a number of conclusions, the most important of them is that the accounting measurement requirements for land under the accounting system differ from The special requirements for municipalities under international accounting and financial reporting standards, the most important research recommendations were including the need to update the accounting system based on the municipalities of international standards to keep abreast of developments and to provide financial information and reliable data in the internal and external environment.

Peran Tata Kelola Perusahaan Dalam Respon Investor Atas Penerapan Nilai Wajar Properti Investasi Dan Aset Tetap di Indonesia

Investors consider the good firm value of the company in the hope of providing additional wealth in the future. Company information announced to the public provides a signal for investors regarding company policies. Fair value accounting provides more timely and transparent information to investors to assess the financial position and the entity performance if it refers to the prevailing values. This study examines the association of applying fair value to investment properties and fixed assets with firm value. This research method employs a quantitative approach. In addition, this study examines the role of corporate governance in the relationship between the application of the fair value of investment properties and fixed assets with firm value. The research data sources from the financial statements of property and real estate sub-sector companies listed on the Indonesia Stock Exchange (IDX) are from www.idx.co.id. Moreover, stock price information is sourced from www.finance.yahoo.com from 2016 to 2019. Based on purposive sampling, the total sample of this study amounted to 52 observations. This study indicates that the implementation of fair value to investment properties is positively associated with firm value, while the application of fair value to fixed assets is negatively associated with firm value. Meanwhile, corporate governance cannot moderate the positive effect of implementing the fair value of investment properties and fixed assets with firm value. This research indicates that the Financial Services Authority needs to improve its corporate governance policies and monitor the implementation of corporate governance applied to companies listed on the IDX.