Real Estate Economics : a Point-to-Point Handbook.
Real Estate Economics: A point-to-point handbook introduces the main tools and concepts of real estate (RE) economics. It covers areas such as the relation between RE and the macro-economy, RE finance, investment appraisal, taxation, demand and supply, development, market dynamics and price bubbles,...
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| Format: | Electronic eBook |
| Language: | English |
| Published: |
Hoboken :
Taylor and Francis,
2013.
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| Series: | Routledge advanced texts in economics and finance.
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| Subjects: | |
| Online Access: |
Full text (Emmanuel users only) |
Table of Contents:
- 3.3 Determinants of RE investment
- Tobin's q
- 3.3.1 Utility-driven investment
- 3.3.2 Tobin's q
- 3.3.3 RE investment as inflation hedge
- 3.3.4 The role of 'fundamentals'
- 3.3.5 What about non-residential property?
- 3.4 The effect of RE prices on the economy
- 3.4.1 The consumption channel
- 3.4.2 The investment channel
- 3.4.3 The financial sector channel
- 3.4.4 The inflation channel
- 3.4.5 The government's fiscal position channel
- 3.5 The housing wealth effect (HWE)
- 3.5.1 The HWE as a home-equity adjustment
- 3.5.2 The HWE as a PILC adjustment
- 3.5.3 The HWE as a consumer-credit adjustment
- 3.5.4 How strong is the HWE effect, then?
- 3.6 Homeownership and the labour market
- Summary of main points
- Review questions and exercises
- 4 RE finance: loans, equity withdrawal, and MBSs
- Learning outcomes
- 4.1 Loans, mortgages, and maths
- 4.2 Forward mortgages: basic loan types
- 4.2.1 The interest-and-capital repayment loan
- 4.2.2 The interest-only loan
- 4.2.3 The low-start loan
- 4.2.4 The stabilized loan
- 4.2.5 The select-payment loan
- 4.2.6 The cap-and-collar loan
- 4.2.7 The index-linked loan
- 4.3 Remortgaging and equity withdrawal
- 4.3.1 Variable versus fixed interest rates
- 4.3.2 From prepayment to refinancing
- 4.3.3 Cash-out refinancing
- 4.3.4 Tapping into one's home equity
- 4.4 Reverse (or equity release) mortgages
- 4.4.1 Mechanics of a reverse mortgage
- 4.4.2 A right interest rate for a reverse mortgage?
- 4.5 Reverse mortgages in the USA and the UK
- 4.6 Housing finance and homeownership
- 4.7 Mortgage securitization (MS)
- 4.7.1 How MS works
- 4.7.2 Types of MBSs
- 4.7.3 Reasons for MS
- 4.7.4 Effect on RE market
- Summary of main points
- Review questions and exercises
- 5 RE as an investment decision
- Learning outcomes
- 5.1 Definition of commercial RE.
- 5.2 The language of the market place
- 5.2.1 Some definitions
- 5.2.2 Investment vehicles
- 5.3 Characteristics of investment in RE
- 5.4 A portfolio approach to RE investment
- 5.4.1 Portfolio basics
- 5.4.2 RE and correlation between assets
- 5.4.3 RE across countries: correlations (A)
- 5.4.4 RE & other asset classes: correlations (B)
- 5.4.5 An application
- 5.5 Property valuation
- 5.5.1 Investment appraisal: NPV and IRR
- 5.5.2 Special cases in property valuation
- 5.5.3 The capitalization rate
- 5.5.4 The cap rate cycle
- 5.5.5 The band-of-investment concept
- 5.6 Physical life and economic life
- 5.7 Property derivatives and options
- Summary of main points
- Review questions and exercises
- 6 Demand for office-retail-industrial space
- Learning outcomes
- 6.1 Demand for office space
- 6.1.1 Vacant space-occupied space
- 6.1.2 Mathematical modelling of the short term
- 6.1.3 Mathematical modelling of the long term
- 6.1.4 A disturbance and re-establishment of equilibrium
- 6.1.5 The office rental cycle and the NVR
- 6.1.6 Determinants of office demand (and supply)
- 6.1.7 How is the NVR estimated?
- 6.1.8 Office market analysis
- 6.2 Demand for retail space
- 6.2.1 The geographical frame of reference
- 6.2.2 Methods of finding trade areas: the checklist method
- 6.2.3 Methods of finding trade areas: the analogue method
- 6.2.4 Methods of finding trade areas: multiple regression analysis (MRA)
- 6.2.5 Methods of finding trade areas: gravity modelling
- 6.2.6 Methods of finding trade areas: use of GIS
- 6.3 Demand for industrial space
- Summary of main points
- Review questions and exercises
- 7 Housing demand and supply
- Learning outcomes
- 7.1 Dwelling price versus dwelling rent
- 7.2 Residential demand
- 7.3 Modelling residential demand: a (demanding!) example.
- 7.3.1 The De Bruyne-Van Hove model
- 7.4 Adding supply: an extended model
- 7.5 Determinants of housing demand and supply
- 7.6 A practical example of housing 'demand' calculation
- 7.7 Construction, development, and supply changes
- 7.8 A developer's profit maximization problem
- 7.8.1 Profit-maximization in the face of planning constraints
- 7.8.2 The RRR approach to development
- 7.8.3 Profit maximization in the face of a land price
- 7.8.4 More on the negotiation dimension
- 7.9 What price for land?
- 7.9.1 The 'Anglo-American' mode of residential development
- 7.9.2 The 'Greek' mode of residential development
- 7.9.3 Concluding remarks
- Summary of main points
- Review questions and exercises
- 8 Construction flows and market equilibrium
- Learning outcomes
- 8.1 Capital stock adjustment models (CSAMs)
- 8.2 The DiPasquale
- Wheaton (DiPW) model
- 8.3 Summing up the DiPW model
- 8.4 From the DiPW model to a modified CSAM
- 8.4.1 Example A: linear demand
- 8.4.2 From example A: estimating supply
- 8.4.3 Example B: curvilinear demand
- 8.5 CSAMs and the role of expectations
- 8.5.1 'Excessive' response to a price shock
- 8.5.2 'Myopic' and 'rational' expectations
- 8.5.3 Developers' responses to prices in the face of uncertainty
- 8.6 The 'riddle' of mean reversion
- 8.7 The capitalization factor k in the DiPW model
- 8.8 RE shocks and cycles
- 8.8.1 Question (a): one cycle or many?
- 8.8.2 Question (b): origin of the shock
- 8.8.3 Question (c): pro- or counter-cyclical?
- 8.8.4 Question (d): short cycles, long swings?
- 8.8.5 Question (e): different sectors, different cycles?
- 8.8.6 Question (f): cycles and expectations
- 8.9 Appendix: a note on difference equations
- Summary of main points
- Review questions and exercises
- 9 RE taxation
- Learning outcomes
- 9.1 An introduction to taxes and taxation.
- 9.1.1 Kinds of taxes
- 9.1.2 Principles of taxation
- 9.2 (In)ability to pay RE taxes
- 9.3 Is it better to tax property or income from it?
- 9.4 Property taxes, income taxes, and growth
- 9.5 Are RE taxes capitalized in RE prices?
- 9.5.1 Inheritance taxes
- 9.5.2 Tax capitalization and tax incidence
- 9.5.3 Capital-gains taxes
- 9.5.4 Sales taxes
- 9.5.5 (Recurrent) property taxes
- 9.5.6 More on the capitalization issue
- 9.6 Taxation of imputed rental income
- 9.6.1 The 'imputed rent is income' argument
- 9.6.2 The 'income redistribution' argument
- 9.6.3 The 'tenure-neutrality' argument
- 9.6.4 The 'equal treatment of investments' argument
- 9.6.5 The 'taxation efficiency' argument
- 9.6.6 Efficiency and preferences
- 9.7 Appendix: incidence calculation of an ad valorem tax
- Summary of main points
- Review questions and exercises
- 10 Land uses, values, and taxation
- Learning outcomes
- 10.1 The land-use pattern in a market economy
- 10.2 Land uses as expressions of urban hierarchies
- 10.3 Land uses outwards from a city's core
- 10.4 A firm's bid-rent curve
- 10.4.1 A constant-revenue firm
- 10.4.2 A variable-revenue, constant-price firm
- 10.4.3 A variable-revenue, variable-price, and variable-quantity firm
- 10.5 A household's bid-price curve
- 10.5.1 A more traditional approach
- 10.6 How bid-curves help create a land-use pattern
- 10.7 A bid-curve for all land uses in an urban area
- 10.8 Land-value taxation (LVT)
- 10.8.1 Preliminary remarks
- 10.8.2 Tax incidence and deadweight loss (DWL)
- 10.9 Critical appraisal of arguments favouring LVT
- 10.9.1 Argument 1
- 10.9.2 Argument 2
- 10.9.3 Argument 3
- 10.9.4 Argument 4
- 10.9.5 Argument 5
- 10.9.6 Concluding remarks
- 10.10 Economic rent from land
- 10.11 Appendix: derivation of bid-rent curve and rend-gradient
- Summary of main points.