Secondary Housing Market Research Articles

Valuation Expertise of Flats in the Secondary Housing Market by Means of Multicriteria Ranking Evaluation of an Object

This article deals with implementation of comparative valuation of several flats in the secondary housing market in the city of Volgograd. The methodology of multi-criteria ranking evaluation of the qualitative level of flats, which was suggested by the authors earlier, is used as a means of such valuation. The numerical ratings of the index of consumer preferences obtained by the authors are applied to the valuation price of the alternatives under consideration. The obtained revaluation coefficients are analyzed from the standpoint of a seller and that of a buyer.

System approach to the evaluation of a consumer appeal for the objects on the secondary housing market

A real property item of the secondary housing market is presented in a form of a multilevel hierarchical structure. An overall evaluation of a consumer appeal for the object under the study is carried out in terms of the chosen key indicators of housing appraisal with an application of the theory of quality, which is based on the quasi-arithmetic functional mean proposed by Kolmogorov-Nagumo. The elaborated methodology allows customers to choose the best variant of a real property item taking into account architectural and constructive decision of a building, usage of construction and finish materials, accessibility of urban and transport infrastructures, ecological area, as well as personal preferences.

Features of the Development of the Urban Settlement System in the Moscow Oblast

The article analyzes the dynamics of the spatial structure of the urban settlement system in the Moscow oblast. Three homogeneous stages of urban population growth were identified: 1926–1989, 1990–2008, and 2009–2018. The dynamics of prices in the secondary housing market in the cities of the Moscow oblast in the period from 2004 to 2018 are studied. It is found that the distance to Moscow is the leading factor in the formation of the urban settlement system in the Moscow oblast, as well as the price level in the housing market. It is shown that the distribution of the population over the cities of the Moscow oblast corresponds to the law of the rank distribution of relationships, which is a sign of the transformation of a simple urban settlement system into an agglomeration.

Analysis of the filtering process and the ripple effect on the primary and secondary housing market in Warsaw, Poland

The evolution of prices on the Warsaw (Poland) housing market was analyzed to identify the main drivers of market development. Newly developed housing and the existing housing stock were analyzed separatelywith a division into small, medium and large apartments (first stage of research). The macro-districts of the city of Warsaw were taken into account in the analysis (second stage of research). Complete data regarding individual transactions were not available; therefore, the analysis relied on changes in house prices in macro-districts between 2010Q1 and 2016Q4. In general, Poland still has a housing shortage, which is also visible in the capital city. Granger causality tests were performed to provide evidence for the filtering process and the ripple effect in selected market segment pairs. An increase in the prices of small apartments on the secondary market led to an increase in the prices of newly built medium-sized apartments. A similar correlation was noted between the prices of medium-sized apartments on the secondary market and the prices of newly built large apartments. The increase in housing prices in the city center tended to spill over to selected macro-districts. Our findings were confirmed by the vector autoregressive (VAR) model.

Listing of Developer Companies as a Predictor of the Situation on the Residential Real Estate Market

Abstract The stock exchange is considered one of the most important financial institutions in the market economy. The stock market reacts to the state of the economy almost immediately, and, in the end, the quotations of companies affect the state of other markets. The author decided to look at companies from the WIG Real Estate index as important entities shaping the real estate market. When comparing the situation on the capital market with the situation on the residential real estate market, one could, building an appropriate model, conclude how much these markets interact. Purpose - The purpose of the article is to present the links between two important markets, the capital market, with real estate companies as its representatives, and the secondary housing market. In order to achieve the goal, a research hypothesis was formulated: the economic situation on the real estate companies market will be reflected in the situation on the secondary housing market. Design/methodology/approach - Cross-sectional regression analysis was used in the study. Using the data from the Warsaw Stock Exchange and the National Bank of Poland, regression models where price changes in the secondary housing market are explained by the quotations of real estate companies and selected stock exchange indices were built. The study was carried out from the first quarter of 2011 to the third quarter of 2017. Findings - Two models were built in which the rates of return on investments in real estate companies explain the price changes in the secondary housing market in a statistically significant way. Thus, the research hypothesis was positively verified, showing that the real estate market and the stock market of real estate companies are interrelated. Originality/Value - The alternative method of analyzing the real estate market can be considered as the original value of the presented results. A demonstration of the connections between both markets allows us to validate the methods used on the stock market to analyze the real estate market. An example application is the use of methods for estimating the cost of capital from the stock market in the real estate market.

Correlation Analysis Housing Prices and Regions in Shanghai

Most existing house price index construction methods are developed mainly based on transaction data from the secondary housing market, and are not necessarily suitable for the nascent housing markets where a predominant portion of housing transactions are in new units. We evaluate and compare the performances of three most common house price measurement methods in the newly-built housing sector, including the simple average method without quality adjustment, the matching approach with the repeat sales modeling framework, and the hedonic modeling approach.

Informal settlement upgrading, assets and poverty alleviation: Evidence from longitudinal research in South Africa

ABSTRACTThis paper investigates the relationship between housing as an asset and the accumulation of other assets. Using data from a longitudinal research project stretching over nearly 25 years, we have found that besides actual income, there have also been improvements in self-perceived wealth ranking, asset holding, housing size, infrastructure access and human capital. Not all households have however benefited or been found to be better off. We have found that those households who had settled in Freedom Square after 1994 were indeed better off than the earlier settlers. Asset building is a slow process, one driven by stability (accessing urban land and secure tenure), finding an address, accessing education and finding work or remaining employed (though not necessarily in this particular sequence). Contrary to what the Department of Human Settlements suggests, we have found little evidence that informal settlement dwellers build assets by means of the secondary housing market.

An analysis of the primary and secondary housing market in Poland: evidence from the 17 largest cities

ABSTRACTWe analyse the determinants of prices of flats that are bought on the primary (new construction) and secondary markets (existing stock) in the 17 largest cities in Poland during the 2002–2015 period. We find that prices are driven by economic fundamentals, such as income growth and drop in the unemployment or real interest rate. Interestingly, prices in the secondary market react strongly to those fundamentals than to prices in the primary market. Especially, the reaction to the real interest rate is more than twice as high. The most likely buyers on the secondary market are first-time buyers with little own capital, and need a large mortgage. On the other hand, those who buy housing in the primary market quite often sell their old flat, so they only need to acquire the difference. Our finding indicates that the primary and secondary markets need to be analysed separately.

Investment Risk in the Context of Price Changes on the Real Estate and Stock Markets

Abstract The residential real estate market is thought to show a tendency for wide fluctuations in prices, as a result of which price bubbles appear. This element of risk has a direct bearing on investors interested in speculation and those seeking to meet their housing needs. Wide fluctuations in the values of real estate affect the investors’ financial situation in many ways, by determining the possibility of meeting one’s housing needs, reducing or sometimes raising creditworthiness, and by increasing investment risk measured by volatility. Omitting the obvious social dimension of the residential real estate market and concentrating on its financial aspects, the author of the article analyses to what degree wide swings in prices can be recognized as specific to this market. To this end, the volatility of prices in the stock market and in the secondary housing market in Poland is compared. An analysis is performed to establish which of them has higher average volatility measures or rates of return, i.e. which of them is more profitable or secure for investors. Statistical tests are used to find out whether average rates of return or measures of risk are equal or different between the two markets. The results of the research show that the secondary housing market and the stock market differ concerning cumulative average rates of return and standard deviations. In the first of them, they are respectively higher and lower.

Spatial and Hedonic Analysis of House Price Dynamics in Warsaw

The aim of our article is to analyze the dynamics of housing prices in the secondary housing market in Warsaw from Q1 2006 to Q3 2013, taking into account the spatial relationship between prices. In the first part of this research we compare the geographically weighted regression with a linear regression estimated using OLS with spatial variables. In the second part, we combine the geographically weighted regression with the penalized spline regression to extract the effect of time on prices. With this method we obtain a nonlinear and more precise measure of time effects and improved goodness-of-fit statistics. We obtain a hedonic index, that is more robust against short-term changes in house prices than the usual, linear hedonic index. This is a novel approach, which has not been applied before in the case of the Polish housing market. The index allows us to show how interest rates or the housing policy influenced house prices.

Market response to land auction events: a transaction volume approach

Purpose– The purpose of this paper is to investigate the response of transaction volume in Hong Kong’s housing market to public land auctions.Design/methodology/approach– An event study approach with the use of regression analyses was adopted for the empirical study.Findings– Fewer pre-event transactions in the secondary housing spot market come with greater dispersion in the pre-event forecasts of land auction outcomes. Unexpected auction outcomes were also found to minify the post-event transaction volume in the secondary housing spot market, with negative unexpected outcomes exerting a stronger downward force.Research limitations/implications– These findings are contrary to the empirical evidence commonly found in most financial literature on stock transaction volume around corporate earnings announcements with an assumption of negligible transaction costs. Imperfect market structure, differences in sellers’ and buyers’ characteristics and short-sale restriction may explain the disparity.Practical implications– Price in the secondary housing market is more sensitive to negative unexpected land auction outcomes. The analysis results of the current study attest that the impact exerted by the negative unexpected auction outcomes on transaction volume in the housing spot market is stronger than that of positive unexpected auction outcomes.Originality/value– Unlike price and return, transaction volume has not received substantial academic attention in property research. In particular, within the existing small body of transaction volume research, the impact of information events on trading activities has been largely ignored.

Analysis of the Real Estate Market of St. Petersburg

Currently, more than half of the residents of St. Petersburg are not satisfied with their housing conditions. Plus a constant influx of migrants, which gives additional burden to domestic demand. The article analyzes the secondary housing market and the market of apartments in buildings under construction, the dynamics of the activity of demand for apartments. There are the comparison of the prices of residential real estate, depending on the type of apartment, house type, the district where the housing is located. Shown prospects for real estate investing. Highlighted the importance of energy saving technologies and good condition of communications when choosing real estate.

Towards an Understanding the Outcomes of Housing Privatisation in South Africa

Housing privatisation is commonly understood in political economic terms. The proponents of privatisation argue that the provision of ownership enables households to have security of tenure, which in turn leads to increased housing investment, the development of a secondary housing market and a source of income for the local authority by means of land tax. On the other hand, critics of housing privatisation suggest that such processes lead to landlordism and an increased dependence on mortgage finance. This paper uses historical methodology to trace the historical lack of secure tenure for urban black South Africans. The data consists of 395 structured questionnaires conducted in the case study area of Mangaung, the former black township of Bloemfontein. The results suggest that housing privatisation processes in South Africa cannot be viewed only through a political economic lens.

Zastosowanie modeli zmiennych jakościowych do badania ceny rynkowej mieszkań

The article presents the results of the housing market survey in Warsaw in 2009 and 2010. Offers were described by a set of several quantitative and qualitative variables, including the transaction price. In the studied years operated the ”Rodzina na swoim” (”Family on its own”) program, in which the housing price limits were introduced on the opportunity to apply for funding. However, the limits of budget expenditure resulted in the introduction of savings and announcement of the program realization in a modified formula. In this context, conducted by the authors the secondary housing market research shows the characteristics of a dwelling eligible for purchase by the state fund. The co-financing threshold in Warsaw was treated as a dichotomous variable (a feature which is included or not in the range of co-financing). Binomial logit models were used for so defined dependent variable. As independent variables were used both quantitative and qualitative housing characteristics. The use of this type of models allows to assess which variables have the greatest impact on the price of meeting the criteria of the State housing assistance program.

House Price Index Construction in the Nascent Housing Market: The Case of China

Most existing house price index construction methods are developed mainly based on transaction data from the secondary housing market, and are not necessarily suitable for the nascent housing markets where a predominant portion of housing transactions are new units. Using the booming market in China as an example, we evaluate and compare the performances of three most common house price measurement methods in the newly-built housing sector, including the simple average method without quality adjustment, the matching approach with the repeat sales modeling framework, and the hedonic modeling approach. Our analyses suggest that the simple average method fails to account for the substantial complex-level quality changes over time of sales during our sample period, and the matching model fails to control for the effect of developers’ pricing behaviors when adopted in the newly-built sector, hence both are downward biased. Based on this finding, we apply a hedonic method, which allows us to control for both quality changes over time of sales and developers’ pricing behaviors, to 35 major newly-built housing markets and provide the first multi-city constant-quality house price index in China. The new index reveals that the current Chinese housing market is facing a greater risk of mispricing than reported by the existing official metrics.

Roberto G. Quercia, Allison Freeman, Janneke Ratcliffe: Regaining the dream: how to renew the promise of home ownership for America’s working families

Since the start of the Great Recession of 2008, millions of American families have losttheir homes, more than 150 banks have failed, and the global credit freeze has led someanalysts to blame ‘‘these economic crises on policies that promoted homeownership ratherthan on the wildly irresponsible financial schemes promoted by Wall Street’’ (p.1). Thecontinuing crisis raises the question: Is the dream of homeownership over for America’sworking families? No. The dream is still alive, says Roberto G Quercia, Allison Freeman,and Janneke Ratcliffe in their new book, Regaining the Dream. If the working poor areprovided with quality affordable loans, they can successfully make the transition fromrenters to homeowners.Regaining the Dream is an evaluation of ‘‘the largest homeownership demonstration inthe United States—the Community Advantage Program (CAP)’’ (p.ix). This project guar-antees the sale of $2 billion worth of nonconforming mortgages to Fannie Mae (a leadingagency in America’s secondary housing market) thereby enlarging homeownership oppor-tunities for low-income and minority families. (Non-conforming mortgages do not meetFannie Mae underwriting guidelines such as credit quality or loan-to-value ratio). Querciaet al. seek to answer two questions: First, do low-income and minority families benefit fromhomeownership? Second, does a homeownership program for low-income and minorityfamilies, like CAP, expose these people to undue stress and risk? Starting in 1999, theUniversity of North Carolina’s Center for Community Capital (Chapel Hill) tracked theperformance of each of the 46,000 affordable home loans involved in the demonstration andinterviewedmorethan2,000ofthehomeownerseveryyearovera6 yearperiod,2003–2009.The CAP demonstration was a success. CAP families experienced a median equityincrease of $23,000 during the recession. Borrowers also proved to be good credit risks:the default rate for CAP borrowers was less than half that of subprime borrowers, 8 versus18%. And, in contrast to expectations, CAP owners were not more likely to exhibit

HOUSE PRICE CYCLE - THE CASE OF POLAND

The main aim of the paper was to identify changes on the secondary housing market in the years 1996-2011 in selected cities in Poland (Gdansk, Gdynia, Lodz, Poznan and Wroclaw). The subject scope results from the aim of the paper and includes price fluctuations on the secondary housing market, involving both property rights and cooperative property rights for private accommodation. In this research only dwellings located in multifamily buildings are analyzed. Submitted: August, 2011 1st revision: September, 2011 Accepted: October, 2011

DWELLING’S PRICE FLUCTUATIONS AND THE BUSINESS CYCLE

The main aim of the paper is to identify the influence of business cycle in Poland on dwelling’s price fluctuations on the secondary housing market in the years 1996II q. 2009 in Poznan. The subject scope results from the aim of the paper and includes price fluctuations on the secondary housing market, involving both property rights and cooperative property rights for private accommodation. Received: June, 2010 1st Revision: September, 2010 Accepted: October, 2010 JEL Classification: E32, P2

CYCLICAL FLUCTUATIONS OF RESIDENTAIL MARKET IN WROCŁAW

Rafal Kasperowicz Department of Microeconomics Poznan University of Economics CYCLICAL FLUCTUATIONS OF RESIDENTAIL MARKET IN WROCŁAW Radoslaw Trojanek Departament of Investment and Real Estate Poznan University of Economics ABSTRACT. The main aim of the paper is to identify price fluctuations on the secondary housing market in the years 1996-2009 in Wroclaw. The subject scope results from the aim of the paper and includes price fluctuations on the secondary housing market, involving both property rights and cooperative property rights for private accommodation. Received: July, 2010 1st Revision: September, 2010 Accepted: October, 2010

Fluctuations of Flats’ Prices in Poznań during 1999-2008

The main aim of the paper is to identify price fluctuations on the secondary housing market in the years 1996-2008 in Poznan. The paper is divided into three parts. In the first part the time series components are analyzed. Then the methods of business cycles analysis are applied to house prices fluctuations on the local markets. The third part of the paper contains analysis of fluctuation of flats’ prices in Poznan in the years 1996-2008.