Housing affordability and tenure choices: an empirical investigation

Several empirical studies have established that tenure choice and households mobility decisions are highly correlated (Ozyildirim et al., 2005). In the literature, there have been two methods that have used to estimate tenure choice models. The first uses a sample of recent movers while the second employs a sample of all households. Other approaches are mixed (Painter, 2000). This work refers on the results of an empirical analysis, developed to the urban level, by a sample of movers (renters and homeowners). The main goal is to test if homeownership is systematically preferred to leasing and if the housing affordability effect can be estimated by a tenure choice model. A random utility approach is used to model observed choices of renterswithin and between rent and property markets. The analytical results confirm, as expected, the strong trend to the homeownership for the families of renters. But, in current economic situation, the high value of the rent is systematically associated with a reduced chance of changing for the medium-income households. Monetary estimates of affordable rents are given in the last part of the paper, conditioned to the income level, the family size and the previous and actual level of affordability.

Preferences Evaluation with a Choice Experiment on Cultural Heritage Tourism

This work focuses on the elicitation of tourist preferences from an economic evaluation standpoint and in relation to the Royal Savoy's Residences, a cultural network included in the UNESCO World Heritage List. After analyzing the visits to the Metropolitan Museum System of Turin City (Italy), a conjoint choice experiment was implemented, where future scenarios of public/private supply were defined by a certain number of tour packages, characterized by different services and prices. The results emphasize the complementarity of the transport rather than the food and wine services. The research also tries to give some suggestions about the understanding, measurement and evaluation of tourist behavior, opening new possibilities for future research directions in the area of the on-site tourist experienc

LA PERCEZIONE DEL RISCHIO AMBIENTALE NEI CONTESTI DI VALUTAZIONE IPOTETICA. IL CASO DELLE INFRASTRUTTURE URBANE PER LO SMALTIMENTO DEI RIFIUTI

This work highlights how, within the context of contingent valuation, supporting the assessment of monetary measures of mitigation of environmental damages, has not been sufficiently clarified the role played by the perception of environmental risk, particularly in an ex ante context, where the effect of psychological anchoring to the status quo and the amount / type of available information have an important role driving the individual preferences. The contribution to experimental economics - of which the contingent valuation takes share - of the theory of choice under uncertainty and of behavioural economics is briefly traced and, in order to provide empirical evidence, the results of a choice experiment implemented in Turin, in order to assess the effect of the disamenity due to the location of solid waste infrastructure, are showin

Benefit assessment of a local transport system within the cultural heritage tourism

The need for an efficient Transport System (TS) is widely recognized as an important factor of a successful program of tourism development, but little work has been made to investigate the impact of TS on Cultural Heritage Tourism (CHT). This is one of the most recognized and investigated forms of tourism but, unfortunately, there is a fragmentation in the research field that does not allow a full comprehension of existing relationships between TS, CHT, and tourist experience. In this light, the work tries to evaluate the economic impact of the on-site vs. long-distance transports, in a scenario where tourism public policies are not adequately developed. The analysis is based on CHT access data and economic information on travel costs managed with the help of a large data set coming from the Cultural Observatory of Piedmont Region (Italy).The need for an efficient Transport System (TS) is widely recognized as an important factor of a successful program of tourism development, but little work has been made to investigate the impact of TS on Cultural Heritage Tourism (CHT). This is one of the most recognized and investigated forms of tourism but, unfortunately, there is a fragmentation in the research field that does not allow a full comprehension of existing relationships between TS, CHT, and tourist experience. In this light, the work tries to evaluate the economic impact of the on-site vs. long-distance transports, in a scenario where tourism public policies are not adequately developed. The analysis is based on CHT access data and economic information on travel costs managed with the help of a large data set coming from the Cultural Observatory of Piedmont Region (Italy)

La Conjoint Analysis (CA) nelle valutazioni immobiliari

Conjoint Analysis (CA) is probably the most known and widely used tool in marketing research and demand forecasting. The premise of CA is that every product, or service, has multiple attributes, each with a different utility value for the consumer and that individual utilities can be quantified and assessed in a market simulation perspective. In spite of its popularity and wide diffusion, there has been little systematic research relating to the specific market – like the real estate market. Our work starts from this lack and it is organised in three sections: the first introduces a short history of CA and compares the performances of different interview designs: Adaptive Conjoint Analysis (ACA) and Choice Based Conjoint (CBC). The second section presents the case-study – the housing market of Turin – and shows the results of a research experiment. We compare ACA and CBC designs and discuss about the best when the goal is valuation – in other hands, the price is present between the attributes. The third section concludes and focuses on the problem of real estate market simulation and demand forecasting

Real Estate Development, Highest and Best Use and Real Options

The primary aim of this work is to connect the Real Options Theory (ROT) with the real estate investment framework. A great deal of theoretical work exist today; it begun with Merton (1973) and Black & Sholes (1973) and provided new insights into capital budgeting decision-making and new models, used today by corporate managers and practitioners too. Unfortunately, the ROT is not widely used by appraisers respect to the traditional DCF model, even though the developers behaviour gives evidence to the model. It is important to remember that the real estate investments are characterized by irreversible decision and by various sources of risk and uncertainty about future returns, especially when the development process is very long. The flexibility in the real estate investment is related to the alternative uses embedded in the land – traditionally interpreted through the Highest and Best Use approach – and to the characteristics of the building. In fact, the value of vacant land should reflect not only the value based on best immediate use, but also its option value, if the development is delayed and the land is converted into best alternative use in the future. This is also true for the redeveloped urban lands. In brief, this work shows the limits of the traditional analysis (Discounted Cash Flow Model) to capture flexibility in the real estate investment and presents an application – an industrial urban area – implemented by the real option approach within a backward risk-neutral valuation process

La percezione del rischio ambientale nei contesti di valutazione ipotetica. Il caso delle infrastrutture urbane per lo smaltimento dei rifiuti

This work highlights how, within the context of contingent valuation, supporting the assessment of monetary measures of mitigation of environmental damages, has not been sufficiently clarified the role played by the perception of environmental risk, particularly in an ex ante context, where the effect of psychological anchoring to the status quo and the amount / type of available information have an important role driving the individual preferences. The contribution to experimental economics – of which the contingent valuation takes share – of the theory of choice under uncertainty and of behavioural economics is briefly traced and, in order to provide empirical evidence, the results of a choice experiment implemented in Turin, in order to assess the effect of the disamenity due to the location of solid waste infrastructure, are showing

A choice experiment for testing the energy-efficiency mortgage as a tool for promoting sustainable finance

The challenges currently facing the EU in the energy sector include increasing import dependence, limited diversification, high and volatile energy prices, decarbonization, and slow progress in energy efficiency. EU energy policy has provided a wide range of measures to achieve an integrated energy market and sustainability of the building sector. Various incentives and financial instruments have been promoted and financed by governments to help consumers in energy retrofit processes. These include direct investments and fiscal, financial, and market instruments. Public measures have been widely studied but private initiatives have not. In this study, the energy-efficiency mortgage (EEM) is investigated as a credit scheme to attract young people to a real estate market for sustainable buildings, characterized by high sale prices. A choice experiment (CE) was modelled to investigate the preferences of potential young buyers of a new home. The results of this exploratory survey showed an appreciation of the purchase of new A-rated properties according to the Energy Performance Certificate, compared to those that need to be retrofitted or not retrofitted. Consumers like the option of a home energy efficiency renovation being fully managed by a third party (i.e., following the one-stop shop model). The key appeal of energy efficiency for consumers ranges from its ability to support better energy management, to better property value management. The EEM seems to be a promising tool to stimulate investments in energy efficiency and to promote the accessibility and affordability of housing in the sustainable housing market. The results of this study can help private financial institutions to propose appropriate credit plans, which limit the risk of default by the borrower. They can also help public incentive policymakers to propose complementary instruments to EEM