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Forced sales and their impact on real estate prices
KTH, School of Architecture and the Built Environment (ABE), Real Estate and Construction Management, Building and Real Estate Economics. KTH, School of Architecture and the Built Environment (ABE), Centres, Centre for Banking and Finance, Cefin.
KTH, School of Architecture and the Built Environment (ABE), Real Estate and Construction Management. KTH, School of Architecture and the Built Environment (ABE), Centres, Centre for Banking and Finance, Cefin.ORCID iD: 0000-0003-4849-0726
KTH, School of Architecture and the Built Environment (ABE), Real Estate and Construction Management, Building and Real Estate Economics. KTH, School of Architecture and the Built Environment (ABE), Centres, Centre for Banking and Finance, Cefin.ORCID iD: 0000-0002-9944-0510
2016 (English)In: Journal of Housing Economics, ISSN 1051-1377, E-ISSN 1096-0791, Vol. 34, p. 60-68Article in journal (Refereed) Published
Abstract [en]

Based on data of sold apartments and single-family houses in Stockholm, Sweden, during the period of 2006 through 2013, we find that forced sales of apartments and single-family houses cause a substantial price discount. The results of a hedonic spatial Durbin model show a negative impact on transaction price of 20.1% for foreclosed apartments and 24.6% for foreclosed single-family houses. Furthermore, the price discount increases when the number of attempted auctions is limited, which is the case for forced apartment sales owing to a lost membership in a housing association (forfeited). In those cases, the discount is as high as 29.1%.

Place, publisher, year, edition, pages
Elsevier, 2016. Vol. 34, p. 60-68
Keywords [en]
Foreclosure, Housing, Mortgage, Spatial Durbin model
National Category
Economics and Business
Identifiers
URN: urn:nbn:se:kth:diva-195198DOI: 10.1016/j.jhe.2016.08.002ISI: 000388912100005Scopus ID: 2-s2.0-84984614250OAI: oai:DiVA.org:kth-195198DiVA, id: diva2:1050643
Note

QC 20161129

Available from: 2016-11-29 Created: 2016-11-02 Last updated: 2018-04-02Bibliographically approved
In thesis
1. Essays on Foreclosures and Housing Debt
Open this publication in new window or tab >>Essays on Foreclosures and Housing Debt
2018 (English)Doctoral thesis, comprehensive summary (Other academic)
Abstract [en]

This thesis consists of four self-contained essays in the field of real estate economics, and specifically, the market for single-family homes. The first three essays examine sales of foreclosed properties, while essay four is on the conversion process of rental apartments to owner-occupied units in the co-operative form. These topics have a common denominator in the analysis of real estate markets and a link to debt financing. The effect of a foreclosure on price is examined through several methods. In the first essay, a spatial hedonic model is applied on transaction data. In the second essay, the impact on holding-period returns and the rate-of-turnover is estimated through propensity-score matching. Hedonic regressions and appraisal data is used in the third essay, which analyzes the determinants of the price impact caused by a forced sale. The impact of local market conditions is tested and a discount on price is related to the search process among market participants.

The second topic of conversions is addressed in essay four, which focuses on an informational asymmetry between tenants involved in the conversion process and other market participants. An incentive to mismanage housing co-operatives financially is examined through hedonic models applied to apartment transaction data. 

Abstract [sv]

Denna avhandling består av fyra självständiga uppsatser inom området fastighetsekonomi, och mer specifikt marknaden för ägda bostäder. De tre första uppsatserna undersöker exekutiva försäljningar av bostäder medan uppsats fyra undersöker processen att ombilda hyresrätter till bostadsrätter. Dessa två teman har gemensamt att fastighetsmarknaden och relationen mellan fastigheter och skuldfinansiering analyseras. Effekten på pris som orsakas av en exekutiv försäljning undersöks med flera metoder. I uppsats ett tillämpas en spatial hedonisk modell på transaktionsdata. I den andra uppsatsen undersöks den påverkan som en exekutiv försäljning har på omsättningshastighet och avkastning genom propensity-score matchning. Hedoniska modeller och data med uppskattade värden används i uppsats tre, som undersöker faktorer som påverkar den priseffekt som orsakas av en exekutiv försäljning. Påverkan av lokala marknadsförhållanden testas, och en rabatt relateras till sökprocessen hos köpare och säljare.

Det andra temat i denna avhandling behandlas i uppsats fyra som har fokus på en informationsasymmetri mellan de hyresgäster som är inblandade i ombildningsprocessen från hyreslägenheter till bostadsrätter, och andra marknadsaktörer. Ett incitament för att missköta bostadsrättsföreningens ekonomi undersöks genom hedoniska modeller som tillämpas på transaktionsdata. 

Place, publisher, year, edition, pages
Stockholm: KTH Royal Institute of Technology, 2018. p. 39
Series
TRITA-ABE-DLT ; 187
Keywords
Real Estate Economics, Housing, Foreclosure, Mortgage, Hedonic Modeling, Propensity-Score Matching, Informational Asymmetries, Matching Theory
National Category
Economics and Business
Research subject
Real Estate and Construction Management; Economics; Business Studies
Identifiers
urn:nbn:se:kth:diva-225158 (URN)978-91-7729-735-2 (ISBN)
Public defence
2018-05-04, L1, Drottning Kristinas väg 30, Stockholm, 13:00 (English)
Opponent
Supervisors
Funder
VINNOVA
Note

QC 20180403

Available from: 2018-04-03 Created: 2018-04-02 Last updated: 2018-05-15Bibliographically approved

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Donner, HermanSong, Han-SuckWilhelmsson, Mats

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