Research

21 pages, 1905 KiB

Open AccessArticle

Financialization of Real Estate Assets: A Comprehensive Approach to Investment Portfolios through a Gender-Based Study

by Antonio Martínez Raya, Alejandro Segura de la Cal and Ainhoa Rodríguez Oromendía

Buildings 2023, 13(10), 2487; https://doi.org/10.3390/buildings13102487 - 30 Sep 2023

Viewed by 1301

Financialization is a process within the global economy wherein financial markets have been gaining ground in recent years. And yet, whether it has a beneficial or detrimental impact is almost totally unstudied, notably in terms of market effects on the real estate sector. [...] Read more.

Financialization is a process within the global economy wherein financial markets have been gaining ground in recent years. And yet, whether it has a beneficial or detrimental impact is almost totally unstudied, notably in terms of market effects on the real estate sector. To probe more deeply into such a research issue, this study addresses how real estate’s financialization impacts asset distribution by analyzing investment attitudes based on verifiable data from the Spanish wealth tax return. Despite scarce previous literature in the field, the study focused on the gender aspect to highlight the importance of investment decisions concerning risk aversion and related issues through the empirical analysis of the investment portfolios of those taxpayers subject to wealth tax statements. The findings identified show that financialization can lead to the conversion of property assets into stock-related movable assets, and from more to less imbalance, respectively, in terms of the gender gap. The results obtained show a significant gendered difference concerning investment stocks, being thus out of alignment with the gender equity traditionally promoted by the Spanish government. This suggests that although most investment portfolios of real estate properties are based strictly on criteria of profitability, female investors need to be empowered because they could provide a better approach to an economic issue wherein aversion to risk can become a proper criterion of private investors, even when there are sudden macroeconomic changes. Full article

(This article belongs to the Special Issue Housing and Real Estate Economics)

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34 pages, 8035 KiB

Open AccessArticle

Defect Repair Cost and Home Warranty Deposit, Korea

by Junmo Park and Deokseok Seo

Buildings 2022, 12(7), 1027; https://doi.org/10.3390/buildings12071027 - 16 Jul 2022

Cited by 5 | Viewed by 1922

Abstract

Defects in the home cause inconvenience to homeowners and loss to the developer or builder due to cost and damage to reputation. A home warranty deposit exists to protect consumers from home defects. However, it is unclear how much it costs to repair [...] Read more.

Defects in the home cause inconvenience to homeowners and loss to the developer or builder due to cost and damage to reputation. A home warranty deposit exists to protect consumers from home defects. However, it is unclear how much it costs to repair a defect and whether the standard for calculating the warranty deposit is reasonable. This study analyzed the litigation details of 290 home complexes in Korea to investigate defect repair costs and factors affecting them. According to the analysis results, the defect repair cost was 0.538% of the construction cost on average. This is far below 3% of the construction cost, the prevailing standard in the relevant acts. Additionally, there was no case where the defect repair cost ratio exceeded 3%. The actual repair cost for defects was considerably lower than the warranty deposit standard stipulated by the Act. Therefore, this study proposes a method to adjust the warranty deposit collectively and a means to apply it differentially according to the size of the construction cost. This proposal benefits everyone because it protects homeowners and keeps the costs affordable. In addition, it is expected that the warranty deposit can be used as a standard for home construction and post-quality improvement. After analyzing the factors affecting the repair cost, it was found that there was a difference in the repair cost according to the home construction implementor and the construction purchase order method. The warranty deposit system prepares for the possibility that a project owner or builder, who is the project implementor, becomes insolvent. It was found that there was no difference in the repair cost for defects depending on whether the project owner was insolvent. Nonetheless, the possibility of insolvency in the case of a developer was far higher than in the case of a builder. Full article

(This article belongs to the Special Issue Housing and Real Estate Economics)

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19 pages, 1065 KiB

Open AccessArticle

Schools’ Capitalization into Housing Values in a Context of Free School Choices

by Mohammad Ismail, Abukar Warsame and Mats Wilhelmsson

Buildings 2022, 12(7), 1021; https://doi.org/10.3390/buildings12071021 - 15 Jul 2022

Viewed by 1559

Abstract

The issue of schools and their capitalization in property values has been analyzed extensively. Our contribution is to analyze this effect in an alternative institutional context. In this case study, we analyzed the housing market in Stockholm, Sweden. What distinguishes the Swedish school [...] Read more.

The issue of schools and their capitalization in property values has been analyzed extensively. Our contribution is to analyze this effect in an alternative institutional context. In this case study, we analyzed the housing market in Stockholm, Sweden. What distinguishes the Swedish school system is that we have a free choice of schools, which means that a family does not necessarily have to live in a school district to access the schools in that area. This means that families do not have to move to the district to which they intend to send their children but can apply to send them there regardless of whether they live there or not. Nevertheless, families might be interested in living close to good schools to be within walking distance of these schools. This is especially true at the primary school level. Therefore, we analyzed schools’ capitalization in property values in the context of free school choice. We used data on transaction prices for condominiums in Stockholm’s inner city. The results indicate a capitalization of living close to good schools, but this capitalization is limited. We can show that schools’ capitalization depends partly on the quality of the schools and partly on whether or not they are co-located with other externalities, such as green areas. The results also indicate that capitalization is affected by income differences within the city. Full article

(This article belongs to the Special Issue Housing and Real Estate Economics)

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25 pages, 5128 KiB

Open AccessArticle

Analysis of the Spatiotemporal Heterogeneity of Housing Prices’ Association in China: An Urban Agglomeration Perspective

by Guiwen Liu, Kehao Chen, Juan Huang and Xun Deng

Buildings 2022, 12(7), 972; https://doi.org/10.3390/buildings12070972 - 08 Jul 2022

Viewed by 1451

Abstract

With the rise of urban agglomerations, regional divergence of China’s real estate market has gradually intensified. City-specialized policies have become the main emphasis for promoting the healthy development of the regional real estate market. By adopting a gravity model, social net-work analysis, and [...] Read more.

With the rise of urban agglomerations, regional divergence of China’s real estate market has gradually intensified. City-specialized policies have become the main emphasis for promoting the healthy development of the regional real estate market. By adopting a gravity model, social net-work analysis, and impulse response analysis, this paper examines the spatial-temporal heterogeneity of housing prices’ association in the Beijing-Tianjin-Hebei Urban Agglomeration (BTH-UA), the Yangtze River Delta Urban Agglomeration (YRDUA), and the Pearl River Delta Urban Agglomeration (PRDUA), which are the most developed urban agglomerations in China. Meanwhile, the formation mechanism of the housing prices’ association network and spillover effect in urban agglomeration were theoretically analyzed. This paper found that (1) significant aggregation phenomena of housing prices were observed in the urban agglomerations; (2) characteristics of overall and individual networks were dynamically heterogeneous. In the BTHUA and the PRDUA, the associations of housing prices were polarized and sparse, while they were more linked and complex in the YRDUA; (3) polycentric network structure has been demonstrated in the urban agglomerations and the spillover effects of central cities varied in intensity and breadth on responding cities and persisted during the lag period. Accordingly, several policy recommendations have been made. Full article

(This article belongs to the Special Issue Housing and Real Estate Economics)

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24 pages, 323 KiB

Open AccessArticle

Long-Term Dynamics of New Residential Supply: A Case Study of the Apartment Segment in Sweden

by Sviatlana Engerstam, Abukar Warsame and Mats Wilhelmsson

Buildings 2022, 12(7), 970; https://doi.org/10.3390/buildings12070970 - 07 Jul 2022

Cited by 4 | Viewed by 1682

Abstract

Since the size of the homeownership ratio differs significantly between countries, it is important to understand the mechanisms that lie behind the decrease or growth of certain sectors of the housing market such as rentals and housing cooperatives. The aim of this study [...] Read more.

Since the size of the homeownership ratio differs significantly between countries, it is important to understand the mechanisms that lie behind the decrease or growth of certain sectors of the housing market such as rentals and housing cooperatives. The aim of this study is to analyze the long-term dynamics of the new residential supply in Sweden’s three largest cities for the period of 1990–2020 and estimate in what way market fundamentals affect it through new construction and housing conversions. We apply panel data methodology and, in distinction to previous research, consider the development of the housing market (urban growth) as physical volume. The results demonstrate that structural changes are driven mainly by fundamental demand factors and that the displacement effect occurs primarily in the market’s rental sector and not in the owner-occupied segment. The apartment price per square meter, together with mortgage interest rates, are the major driving factors in the process of converting dwellings into housing cooperatives. Fundamental variables that affect new construction in both the rental and housing cooperative sectors are population and income growth. In the presence of a rent control environment, the rent or price level does not contribute to adding new units to the total housing stock. Full article

(This article belongs to the Special Issue Housing and Real Estate Economics)

20 pages, 1341 KiB

Open AccessArticle

How Real Estate Shocks Affect Manufacturing Value Chain Upgrading: Evidence from China

by Yanzhao Yin, Xiaoming Zeng, Shihu Zhong and Youjin Liu

Buildings 2022, 12(5), 546; https://doi.org/10.3390/buildings12050546 - 25 Apr 2022

Cited by 1 | Viewed by 1798

Abstract

Contrary to the conventional viewpoint that “high housing price promotes industrial upgrading”, this study finds that increasingly high housing prices are a pivotal factor that obstructs industrial value chain upgrading. Based on city-level data, micro-level data for Chinese industrial enterprises, and data for [...] Read more.

Contrary to the conventional viewpoint that “high housing price promotes industrial upgrading”, this study finds that increasingly high housing prices are a pivotal factor that obstructs industrial value chain upgrading. Based on city-level data, micro-level data for Chinese industrial enterprises, and data for listed Chinese enterprises, this study examines the impacts of urban housing prices on value chain upgrading. We find that soaring housing prices in China since 2004 stunted industrial value chain upgrading, as indicated by the value-added rate. When housing prices increase by 100%, the enterprise value-added rate decreases by 12.4%. Intermediary mechanism analysis shows that housing price increases lead to innovation input suppression effects and resource misallocation effects, which in turn obstruct industrial value chain upgrading. Further analysis demonstrates that the impacts of housing price increases on industrial value chain upgrading, presenting an inverted-U shape, are varied in terms of time and region. Enterprises’ value chain upgrading also showcases different degrees of sensitivity to housing price increases, due to their respective features. The conclusions of this study carry significant policy implications for the sound development of the real estate market and industrial upgrading in China, as well as in developing countries at large. Full article

(This article belongs to the Special Issue Housing and Real Estate Economics)

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18 pages, 2191 KiB

Open AccessArticle

The Capitalization of School Quality in Rents in the Beijing Housing Market: A Propensity Score Matching Method

by Zisheng Song

Buildings 2022, 12(4), 485; https://doi.org/10.3390/buildings12040485 - 14 Apr 2022

Cited by 5 | Viewed by 1864

Abstract

In China, the capitalization of education resources in housing prices has been widely discussed. However, insufficient attention is paid to it in rents. Thus, this paper mainly aims to identify the capitalization of school quality in rents. It estimates a hedonic treatment effects [...] Read more.

In China, the capitalization of education resources in housing prices has been widely discussed. However, insufficient attention is paid to it in rents. Thus, this paper mainly aims to identify the capitalization of school quality in rents. It estimates a hedonic treatment effects model by introducing the propensity score matching (PSM) method. The empirical analysis is based on 49,438 rental transaction data of 2016–2018 in Beijing, China. It finds that school quality can be significantly capitalized in rents across different school quality (ranked as 1st-class, 2nd-class, and popular-class), space, and time. Besides, quality school density (the number of quality schools) within neighborhoods can significantly moderate the nearest school’s capitalization, promoting a 3.5% capitalization increase in outer municipal districts but a 3% decrease in inner districts. The popular-class schools can be capitalized into the rent of inner districts, probably because of other exogenous factors (e.g., housing prices, public transit). In addition, the equitable housing policy might show a potential risk in worsening social inequality between homeowners and renters in the municipal areas with high competition for 1st-class schools. In contrast, it may remedy such inequality in outer districts with less competition for quality schools. Full article

(This article belongs to the Special Issue Housing and Real Estate Economics)

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17 pages, 706 KiB

Open AccessArticle

Impact of Induced Seismicity on the Housing Market: Evidence from Pohang

by Jengei Hong, Hyunjae Jo, Ducksu Seo and Songhee You

Buildings 2022, 12(3), 286; https://doi.org/10.3390/buildings12030286 - 02 Mar 2022

Cited by 2 | Viewed by 1532

Abstract

In this study, we analyze the case of induced seismicity in Pohang, South Korea, in 2017 to investigate the effect of seismic risk perception on the local residential property market. Based on a hedonic pricing model with a difference-in-differences method, we examine the [...] Read more.

In this study, we analyze the case of induced seismicity in Pohang, South Korea, in 2017 to investigate the effect of seismic risk perception on the local residential property market. Based on a hedonic pricing model with a difference-in-differences method, we examine the geographic distribution of the effects of unexpected earthquake hazards. Our results indicate an overall reduction in local property values, but the magnitudes of negative externality for housing prices decrease with respect to the distance from the epicenter. In areas within 3 km of the epicenter, the asset value reduced by approximately 20% after an earthquake event, but if the distance from the epicenter was higher than 12 km, the negative effect on the price was not significant. In addition, we examine how the experience of seismic events affect the preference on the anti-seismic building structure. The results show that the market valuation on the anti-seismic system significantly escalated after the earthquake. Full article

(This article belongs to the Special Issue Housing and Real Estate Economics)

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10 pages, 235 KiB

Open AccessArticle

My Fault or Default—Household Behaviors Living in a Climate-Smart Building

by Misse Wester

Buildings 2022, 12(2), 245; https://doi.org/10.3390/buildings12020245 - 20 Feb 2022

Cited by 1 | Viewed by 1475

Abstract

Decreasing climate impact of households is a concern for many actors. One way to address this challenge is to focus on household behaviors related to energy use and consumption. Another is to construct climate-smart houses that encourage households to utilize smart functions that [...] Read more.

Decreasing climate impact of households is a concern for many actors. One way to address this challenge is to focus on household behaviors related to energy use and consumption. Another is to construct climate-smart houses that encourage households to utilize smart functions that reduce emissions. This article examines the link between these two strategies and investigates how living in a climate-smart house affects household behaviors, by conducting interviews with households before and after they moved into a climate-neutral house. Results indicate that overall, emissions decrease after the move, mostly due to the features of the building itself rather than changes in behavior. Unintended effects were also observed, calling into question which strategy is most effective in reducing a household’s climate footprint. Full article

(This article belongs to the Special Issue Housing and Real Estate Economics)

40 pages, 1706 KiB

Open AccessArticle

Private Renting vs. Mortgage Home Buying: Case of British Housing Market—A Bayesian Network and Directed Acyclic Graphs Approach

by Janusz Sobieraj and Dominik Metelski

Buildings 2022, 12(2), 189; https://doi.org/10.3390/buildings12020189 - 07 Feb 2022

Cited by 7 | Viewed by 2791

Abstract

The worsening of housing problems in many countries has become a topic of global interest. Researchers point to a variety of factors that influence individual housing tenure decisions. Our study is based on longitudinal English Housing Survey (EHS) data (2008–2009 to 2019–2020, with [...] Read more.

The worsening of housing problems in many countries has become a topic of global interest. Researchers point to a variety of factors that influence individual housing tenure decisions. Our study is based on longitudinal English Housing Survey (EHS) data (2008–2009 to 2019–2020, with survey years matching financial years, i.e., running April–March) and identifies flows between different forms of housing tenure in the U.K. and analyses conditional dependencies of a range of EHS variables using a directed acyclic graph (DAG). More specifically, we take into account variables such as first-time buyers (FTB), mortgage payments, rent payments, share of mortgage/rent in household income, and receipt of housing benefit (HB), with some variables also reflecting a regional breakdown (captured separately for London and England excluding London) to illustrate the complex nature of regional differences in explaining changes in housing tenure. We address some of the problems and challenges of the housing market in the U.K. today, and, in particular, examine what influences private renters and those buying with a mortgage. A key conclusion from this study is that housing benefit does not necessarily ease the way for private renters into their own housing. The study is quantitative in nature and uses the English Housing Survey and Bayesian network (BN) analysis. Unlike traditional methods, such as multiple regression or panel regression, where the researcher somehow suggests the type of a relationship between certain variables, BN’s learning algorithm analyses different iterations between variables and finds the most appropriate relationships between them. Full article

(This article belongs to the Special Issue Housing and Real Estate Economics)

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19 pages, 2067 KiB

Open AccessArticle

An Exploratory Analysis of Housing and the Distribution of COVID-19 in Sweden

by Mohammad Ismail, Abukar Warsame and Mats Wilhelmsson

Buildings 2022, 12(1), 71; https://doi.org/10.3390/buildings12010071 - 12 Jan 2022

Cited by 3 | Viewed by 2133

Abstract

The impact of COVID-19 on various aspects of our life is evident. Proximity and close contact with individuals infected with the virus, and the extent of such contact, contribute to the intensity of the spread of the virus. Healthy and infected household members [...] Read more.

The impact of COVID-19 on various aspects of our life is evident. Proximity and close contact with individuals infected with the virus, and the extent of such contact, contribute to the intensity of the spread of the virus. Healthy and infected household members who both require sanctuary and quarantine space come into close and extended contact in housing. In other words, housing and living conditions can impact the health of occupants and the spread of COVID-19. This study investigates the relationship between housing characteristics and variations in the spread of COVID-19 per capita across Sweden’s 290 municipalities. For this purpose, we have used the number of infected COVID-19 cases per capita during the pandemic period—February 2020 through April 2021—per municipality. The focus is on variables that measure housing and housing conditions in the municipalities. We use exploratory analysis and Principal Components Analysis to reduce highly correlated variables into a set of linearly uncorrelated variables. We then use the generated variables to estimate direct and indirect effects in a spatial regression analysis. The results indicate that housing and housing availability are important explanatory factors for the geographical spread of COVID-19. Overcrowding, availability, and quality are all critical explanatory factors. Full article

(This article belongs to the Special Issue Housing and Real Estate Economics)

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21 pages, 9160 KiB

Open AccessArticle

The Influence of Government’s Economic Management Strategies on the Prefabricated Buildings Promoting Policies: Analysis of Quadripartite Evolutionary Game

by Yinghui Song, Junwu Wang, Denghui Liu, Yanru Huangfu, Feng Guo and Yipeng Liu

Buildings 2021, 11(10), 444; https://doi.org/10.3390/buildings11100444 - 29 Sep 2021

Cited by 14 | Viewed by 2549

Abstract

As an efficient measure to protect the environment and reduce energy consumption, promoting prefabricated buildings can lead to the sustainable development of the world economy and long-term economic benefits for society. Nevertheless, for China, it is immature because of the high cost and [...] Read more.

As an efficient measure to protect the environment and reduce energy consumption, promoting prefabricated buildings can lead to the sustainable development of the world economy and long-term economic benefits for society. Nevertheless, for China, it is immature because of the high cost and difficulties in the promotion. The government’s strategies in economy and management are crucial to promoting prefabricated building policies. This paper establishes a quadripartite evolutionary game model composed of construction units, property developers, homebuyers, and government departments under the government supervision system by analyzing the entire interest chain of prefabricated buildings projects. It aims to study the impact of government management and economic strategies on promoting prefabricated building policies. The results show that: (1) The government should ensure the construction safety of projects through mature supervision systems to reduce citizens’ resistant moods caused by project quality problems; (2) The government should improve the reward and punishment mechanism to motivate construction units and developers; (3) The government should invite supervision consulting companies to increase information transparency, avoiding the economic losses of the people and the obstruction of policy implementation caused by information imbalance. Full article

(This article belongs to the Special Issue Housing and Real Estate Economics)

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