Real Estate eJournal最新文献

{"title":"How Much Do Households Dislike Local Density? And Do Developers Fully Consider Their Preferences? Evidence from a Policy Change in Singapore","authors":"Eric Fesselmeyer, Haoming Liu, L. Poco","doi":"10.2139/ssrn.3934747","DOIUrl":"https://doi.org/10.2139/ssrn.3934747","url":null,"abstract":"This paper measures how much households dislike density in their immediate surroundings. Using transaction and administrative data in Singapore, and exploiting the introduction of a regulation that restricted the number of housing units for certain land lots, we find that households do indeed discount density: a 10% increase in within-development density decreases price per square meter by up to 4%. Further, we find that the mean price per square meter of the average development increased by 1 to 3% after the regulation was introduced, while the amount of built-up space remained constant. The increase in total revenue suggests that developers may underestimate the externality caused by density. Our results are particularly relevant during the lockdowns and social distancing of the coronavirus pandemic.","PeriodicalId":21047,"journal":{"name":"Real Estate eJournal","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2021-01-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"79865953","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Real Options Problem with Non-Smooth Obstacle","authors":"Subash Acharya, A. Bensoussan, D. Rachinskii, A. Rivera","doi":"10.2139/ssrn.3751068","DOIUrl":"https://doi.org/10.2139/ssrn.3751068","url":null,"abstract":"We consider a real options problem, which is posed as a stochastic optimal control problem. The investment strategy, which plays the role of control, involves a one-time option to expand (invest) and a one-time option to abandon (terminate) the project. The timing and amount of the investment and the termination time are parameters to be optimized in order to maximize the expected value of the profit. This stochastic optimization problem amounts to solving a deterministic variational inequality in dimension one, with the associated obstacle problem. Because we consider both cessation and expansion options and fixed and variable costs of expansion, the obstacle is non-smooth. Due to the lack of smoothness, we use the concept of a weak solution. However, such solutions may not lead to a straightforward investment strategy. Therefore, we further consider strong ($C^1$) solutions based on thresholds. We propose sufficient conditions for the existence of such solutions to the variational inequality with a non-smooth obstacle in dimension one. When applied to the real options problem, these sufficient conditions yield a simple optimal investment strategy with the stopping times defined in terms of the thresholds.","PeriodicalId":21047,"journal":{"name":"Real Estate eJournal","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2020-12-17","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"85251888","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Tracking the Pulse of a City – 3D Real Estate Price Heat Maps","authors":"Sumit Agarwal, Ying Fan, D. McMillen, T. Sing","doi":"10.2139/ssrn.3746134","DOIUrl":"https://doi.org/10.2139/ssrn.3746134","url":null,"abstract":"This paper proposes the use of a semiparametric model based on a locally weighted approach that controls for dynamic agglomeration and diffusion effects in constructing localized housing price indices. Based on residential transaction records in Singapore, we create a three-dimensional interactive heat maps that allow for better measurement and visualization of spatial variations and heterogeneity in price appreciation. The heat map captures regional variations and temporal dispersions in price appreciation rates in the business cycle. Our methodology provides high-resolution information about price dynamics that could aid individual buyers, investors, and policy makers in making objective and informed decisions.","PeriodicalId":21047,"journal":{"name":"Real Estate eJournal","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2020-12-10","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"80163822","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Climate Change Risk and the Cost of Mortgage Credit","authors":"Duc Duy Nguyen, S. Ongena, Shusen Qi, Vathunyoo Sila","doi":"10.2139/ssrn.3738234","DOIUrl":"https://doi.org/10.2139/ssrn.3738234","url":null,"abstract":"\u0000 We show that lenders charge higher interest rates for mortgages on properties exposed to a greater risk of sea level rise (SLR). This SLR premium is not evident in short-term loans and is not related to borrowers’ short-term realized default or creditworthiness. Further, the SLR premium is smaller when the consequences of climate change are less salient and in areas with more climate change deniers. Overall, our results suggest that mortgage lenders view the risk of SLR as a long-term risk and that attention and beliefs are potential barriers through which SLR risk is priced in residential mortgage markets.","PeriodicalId":21047,"journal":{"name":"Real Estate eJournal","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2020-11-26","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"87000809","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"The Housing Crisis and the Constitution","authors":"H. Hogan, Finn Keyes","doi":"10.2139/SSRN.3731506","DOIUrl":"https://doi.org/10.2139/SSRN.3731506","url":null,"abstract":"Ireland has been in the grip of a housing crisis for several years. Lately, there have been mounting calls for a referendum to introduce a right to housing in the Constitution. Regardless of the merits of this proposal, it stems, in part, from a perception that the Constitution in its current form inhibits the Oireachtas from taking radical steps to remedy the housing crisis. We argue instead that legal interpretations of constitutional case law have over-estimated the degree to which the courts will protect individual property rights at the expense of the common good. In Part I, we outline the case law relating to the protection of property rights in the Constitution, and identify a number of key principles. We conclude from an examination of Irish case law that the courts have, largely, deferred to the Oireachtas in restricting individual property rights in favor of the common good, provided any measures are designed to achieve a clear social objective, are not based on arbitrary or discriminatory considerations, and respect fair procedures. In addition, we note that the courts have been particularly deferential to Oireachtas in taking steps to secure the common good in times of crisis. In Part II, we examine some of the Bills proposed in the Oireachtas over the last several years to address Ireland’s housing crisis and assess, in light of case law, the likelihood that they might have been found constitutional. Despite the wide deference shown by the courts to the Oireachtas in limiting property rights in favor of the public interest, we note that in response to these Bills, the Government has often declared itself to be acting on the basis of legal advice to the effect that radical housing reform would necessarily prejudice the individual property rights of landlords. This has meant that, in reality, the wide provision for legislating for the pressing needs of the public has been diminished in favor of prioritizing individual property rights. This does not correlate with the attitude espoused by the courts. We argue that there is little to suggest that the courts would view constitutional property rights as posing a barrier to radical housing reform, should appropriate safeguards be included. In Part III, we conclude that successive Governments have continued to rely on a narrow understanding of property rights case law to justify a constrained role for the State in the housing market. While this is a perfectly valid political preference, we suggest that it is not a constitutional principle.","PeriodicalId":21047,"journal":{"name":"Real Estate eJournal","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2020-11-16","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"80867172","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Euro Housing Market Co-Movement: Medium vs. Short-Term Cycles","authors":"W. Miles","doi":"10.2139/ssrn.3727027","DOIUrl":"https://doi.org/10.2139/ssrn.3727027","url":null,"abstract":"A lack of co-movement among the national housing markets in the euro monetary union makes the job of the ECB difficult. If markets are depressed in some countries, while booming in others, the ECB would be unable to create simultaneous loose and tight monetary conditions tailored to each national situation. Co-movement across national housing markets has thus been a topic of several previous studies. Most of these papers focused on business-cycle frequency dynamics. Medium term cycles, however, have been shown to play a more important role for long-run output and the financial cycle than short-term fluctuations. We examine both business cycle and medium-term components of housing in eight euro nations. We find that the medium cycle is more volatile than the business cycle component in all markets. This indicates the medium cycle plays a more important role for housing in the long-run than short-term fluctuations. We find, however, that there is greater co-movement among the medium cycles of different national housing markets than between the short-term fluctuations. <br><br>We also find that co-movement of short-term cycles did appear to spike subsequent to the euro’s adoption, but that this greater apparent integration did not persist, and short-term co-movement has fallen in recent years. Finally, although medium-term co-movement is for most countries higher than that of the business cycle frequency, this greater synchronization does not appear to be a function of the euro common currency itself.","PeriodicalId":21047,"journal":{"name":"Real Estate eJournal","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2020-11-08","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"87915142","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Does Temporary Mortgage Assistance for Unemployed Homeowners Reduce Longer Term Mortgage Default? An Analysis of the Hardest Hit Fund Program","authors":"Stephanie Moulton, Yu-Ri Chun, S. Pierce, Holly Holtzen, Roberto G. Quercia, Sarah F. Riley","doi":"10.2139/ssrn.3559794","DOIUrl":"https://doi.org/10.2139/ssrn.3559794","url":null,"abstract":"The substantial costs of foreclosures to individuals and society motivated nearly $40 billion in government subsidies to homeowners during the Great Recession. Most of these subsidies were in the form of permanent loan modifications with mixed evidence of effectiveness. This paper estimates the loan outcomes of an alternative form of mortgage subsidy that provided unemployed homeowners with temporary mortgage payment assistance, through the U.S. Department of Treasury’s Hardest Hit Fund (HHF). Our primary empirical strategy exploits the fact that some states were not eligible to offer an HHF program and that certain Metropolitan Statistical Areas (MSAs) encompass jurisdictions in both HHF and non-HHF states. We match HHF-assisted homeowners to otherwise similar non-assisted homeowners who lived in the same MSA but were not eligible for HHF assistance because they lived in a non-HHF state. By 48 months after the start of assistance, receipt of HHF is associated with a 28 percentage point reduction in the probability of default, which is a 49 percent reduction in the average default rate of 57 percent. In support of the liquidity hypothesis, we find that the HHF effect is not driven by a reduction in mortgage balance, which only occurs for about 10 percent of HHF borrowers. Further, the effect is larger for borrowers who were underwater on their mortgages at the time of assistance.","PeriodicalId":21047,"journal":{"name":"Real Estate eJournal","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2020-10-30","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"73294792","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"The Anatomy of Collateralized Loan Obligations: On the Origins of Covenants and Contract Design","authors":"Shohini Kundu","doi":"10.2139/ssrn.3740092","DOIUrl":"https://doi.org/10.2139/ssrn.3740092","url":null,"abstract":"This paper provides a dissection of the Collateralized Loan Obligation (CLO) market and examines the significance of covenants in facilitating the provision of credit. Since the Great Financial Crisis of 2008, the leveraged loan market has witnessed unprecedented growth. CLOs play an increasingly central role in the provision of credit to corporations, holding as much as 75% of all new institutional leveraged loans, as reported in 2019. The rise of the leveraged loan and CLO markets have attracted the attention of central banks which have been concerned with both the growth of the market and the opaque nature of interconnections between intermediaries, leveraged borrowers, and investors. Despite their increasing importance, little is understood about CLO intermediaries. In this paper, I describe the agency frictions inherent in the CLO market, and discuss how optimal contracts are derived with covenants that curtail such frictions. In addition, I describe the general macroeconomic milieu that has facilitated the rapid growth of the CLO market as well as recent changes that have developed. Understanding the structural aspects and dynamics of CLOs intermediaries, situated between investors and loan syndicates, is paramount for analysis of the innards of the market, the role of covenants, and developing insights into the shadow banking sector as well as other securitizations.","PeriodicalId":21047,"journal":{"name":"Real Estate eJournal","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2020-10-27","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"85312248","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Taming the Housing Crisis: An LTV Macroprudential Policy","authors":"R. Forster, Xiaojin Sun","doi":"10.2139/ssrn.3664482","DOIUrl":"https://doi.org/10.2139/ssrn.3664482","url":null,"abstract":"This paper develops a DSGE framework featuring a heterogeneous housing market, endogenous \u0000default, and a banking sector. We find that the idiosyncratic mortgage risk shock plays an important \u0000role in explaining the fluctuations of house prices during the mid-1980s and the years leading up to \u0000the financial crisis. The same shock is also one of the main driving forces of household loans. By \u0000placing an occasionally binding constraint on the loan-to-value ratio, we find that the overheating \u0000of the housing economy in the early 2000s and the subsequent crash could have been alleviated, if \u0000authorities had adopted such a macroprudential policy measure. A welfare comparison indicates \u0000that the maximum loan-to-value policy is preferable over an augmented Taylor rule that responds \u0000to house price growth.","PeriodicalId":21047,"journal":{"name":"Real Estate eJournal","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2020-10-24","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"75404047","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"The Misallocation in the Chinese Land Market","authors":"Xu Fei","doi":"10.2139/ssrn.3716540","DOIUrl":"https://doi.org/10.2139/ssrn.3716540","url":null,"abstract":"This paper proposes a spatial equilibrium model to quantify welfare losses from land market distortions in China. In the model, heterogeneous firms in a variety of sectors choose their locations across regions with costly trade, frictional labor migration, and land market distortions. We match land transaction and firm-level survey data to estimate land market distortions for firms. Misallocation arises when similar firms are faced with land prices that effectively prevent productive firms from establishing in large cities where they can benefit from agglomeration forces and access to higher productivity. Our framework incorporating land market distortions also helps clarify the mystery of China’s undersized cities, a phenomenon noted by Au and Henderson (2006) and Chauvin et al. (2017). Our estimates suggest large negative effects of land policies on the economic welfare in China. We end with a counterfactual exercise that suggests that a coordinated land and labor migration reform would generate welfare gains and reduce regional inequality","PeriodicalId":21047,"journal":{"name":"Real Estate eJournal","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2020-10-21","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"72872265","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}