Price formation through real estate exchange: Informing and mediating evaluation with attachment

Abstract

This paper examines the process of price formation in markets. Pricing is explored as a process centrally informed by a plurality of evaluations that draw on calculations and attachment. Building on a range of data sources—36 interviews, 60 market exchange observations, seven hours of shadowing a real estate agent, and a sample of 136 property advertisements on the Sydney real estate market—this study demonstrates that price is incrementally formed through an exchange process which is composed of three stages, each offering several moments of evaluation that guide the decision of whether to further progress with an exchange. Overall, attachment is shown to work alongside calculation to inform evaluations by allowing actors to consider their experiences of relating in their evaluations. This study illustrates that what counts and how valuable a property is deemed to be vary between evaluations, and that using attachment to evaluate favours an emotional premium, implying a higher price.