Housing Affordability and Upward Mobility from Public to Private Housing in Singapore

This paper examines the ability of buyers to afford and upgrade to private housing using the experience in land scarce Singapore as a case study. The concepts of the “threshold buyer” and “threshold upgrader” are introduced to construct an operational inter-temporal model of affordability and upward mobility, taking into consideration income, mortgage rates, prices of public housing flats and the legislative/financing framework in Singapore. The theoretical private property price computed by the upward mobility model is the lower bound dictated by affordability and cash outlay considerations such that the buyer/upgrader is no better or worse off arising from changes in the relevant factors over time. The model is empirically tested to evaluate the theoretical underpinnings as well as the ability of the model to predict private property price. Finally, the paper examines the implications for housing ownership policy in a wider context.Housing, affordability, upgrade, property price, mortgage rate, income

Price Discovery in Real Estate Auctions: The Story of Unsuccessful Attempts

Little is known of the effects of the auction mechanism in relation to post-auction market sales. This empirical study of unsuccessful auctions shows that approximately half of these properties were eventually sold via private negotiations, at higher prices relative to last bids. The probability of a subsequent post-auction transaction is significantly higher for apartments and terrace houses and when auction turnout is high; and lower in the absence of any bid and in some years. In addition, downward revisions to the opening bid improve the probability of subsequent sale. Prices of subsequent re-auctioned and privately negotiated sales decline with time to sale, consistent with the search process explanation.

Factors Influencing Auction Outcomes: Bidder Turnout, Auction Houses and Market Conditions

This study provides new evidence on the outcomes of auctions of residential real estate, focusing on the effects of bidder turnout, pricing, market conditions and auction houses. Our analysis of properties offered for sale by auction in Singapore from 1995 to 2000 shows that several variables are significant in explaining why an auction results in a sale or not. These variables included the state of the market, the timing of the auction (year), the number of bidders at the auction and the auction house. We also find that the probability of a sale is higher for distress sales, for more homogenous properties and for those located in the central region. Finally, we provide a sensitivity analysis of how market conditions and the choice of auction house influence the probability of a sale.

Seller versus Broker: Timing of Promotion

Sellers and brokers may differ in preferred timing of costly promotion. Sellers with holding costs are anxious to sell. Sellers with showing costs want a slower approach. We find a standard listing contract where the broker chooses promotion timing can be efficient if sellers have no significant holding or showing costs. We then delineate the efficient listing contract provisions for duration and fee structure for sellers who have holding and/or showing costs.

The 2014 Maastricht-NUS-MIT International Real Estate Finance & Economics Symposium: Editors’ Introduction to the Special Issue

This is the Editors’ Introduction to the special issue of the Journal of Real Estate Finance and Economics. The issue includes nine papers presented at the 2014 Maastricht-NUS-MIT (MNM) Symposium on International Real Estate Finance and Economics, held at Maastricht University in September 2014. This Introduction briefly describes the articles included in the special issue. The papers cover a broad range of topics

The wealth effects of REIT property acquisitions and dispositions: the creditors’ perspective

Prior studies of REIT property transaction activity focus on shareholder wealth effects. This study examines the effects of property acquisitions, dispositions, and overall trading activity on unsecured bond spreads, credit rating changes, and rating outlooks using a sample of the listed equity REITs in the U.S. We find that active property trading in general decreases creditors’ wealth, but this negative impact is significantly mitigated for REITs with positive NAV premiums and when REITs use sale proceeds to pay down debt after the transactions. We also find that property transactions followed by an increased geographic focus significantly increase bond yield spreads and decrease the probability of credit rating upgrades

Erratum to: Introduction to the Special Issue

The papers, “Model Stability and the Subprime Mortgage Crisis,” by X. An, Y. Deng, E. Rosenblatt and V.W. Yao and “Pricing Inefficiencies in Private Real Estate Markets Using Total Return Swaps,” by C. Lizieri, G. Marcato, P. Ogden and A. Baum were scheduled to be part of the special issue. Instead, the papers were published in Volume 45, Number 3, 2012, pages 545 and 774, respectively

Correction: Comparing the genomes of Helicobacter pylori clinical strain UM032 and mice-adapted derivatives

Abstract is not available in fulltext.Published versio