Uncertainty and new apartment price setting: A real options approach

Shi, S; Yang, Z; Tripe, D; Zhang, H

Uncertainty and new apartment price setting: A real options approach

Shi, S

Yang, Z Tripe, D Zhang, H

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Publication Type:: Journal Article
Citation:: Pacific Basin Finance Journal, 2015, 35 pp. 574 - 591
Issue Date:: 2015-11-01

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Field	Value	Language
dc.contributor.author	Shi, S https://orcid.org/0000-0003-4188-5151	en_US
dc.contributor.author	Yang, Z	en_US
dc.contributor.author	Tripe, D	en_US
dc.contributor.author	Zhang, H	en_US
dc.date.issued	2015-11-01	en_US
dc.identifier.citation	Pacific Basin Finance Journal, 2015, 35 pp. 574 - 591	en_US
dc.identifier.issn	0927-538X	en_US
dc.identifier.uri	http://hdl.handle.net/10453/119323
dc.description.abstract	© 2015 Elsevier B.V. This paper investigates real estate development firms' pricing behaviours in Beijing, China during the period 2006-2008. New apartment prices are set by real estate development firms at the presale stage with widely observed price rigidity. Home buyers are often price takers without much power of negotiation in the price setting process. We find that real estate development firms apply real options theory for new apartment price setting at the presale stage, having regard also to apartments' physical attributes, firms' financial position and other economic conditions. Our results shed lights on the nature of residential real estate development market, in particular how changes in the market uncertainty will affect firms' price setting behaviours.	en_US
dc.relation.ispartof	Pacific Basin Finance Journal	en_US
dc.relation.isbasedon	10.1016/j.pacfin.2015.10.004	en_US
dc.subject.classification	Finance	en_US
dc.title	Uncertainty and new apartment price setting: A real options approach	en_US
dc.type	Journal Article
utslib.citation.volume	35	en_US
utslib.for	1502 Banking, Finance and Investment	en_US
utslib.for	1501 Accounting, Auditing and Accountability	en_US
pubs.embargo.period	Not known	en_US
pubs.organisational-group	/University of Technology Sydney
pubs.organisational-group	/University of Technology Sydney/Faculty of Design, Architecture and Building
pubs.organisational-group	/University of Technology Sydney/Faculty of Design, Architecture and Building/School of Built Environment
utslib.copyright.status	closed_access
pubs.publication-status	Published	en_US
pubs.volume	35	en_US

Abstract:

© 2015 Elsevier B.V. This paper investigates real estate development firms' pricing behaviours in Beijing, China during the period 2006-2008. New apartment prices are set by real estate development firms at the presale stage with widely observed price rigidity. Home buyers are often price takers without much power of negotiation in the price setting process. We find that real estate development firms apply real options theory for new apartment price setting at the presale stage, having regard also to apartments' physical attributes, firms' financial position and other economic conditions. Our results shed lights on the nature of residential real estate development market, in particular how changes in the market uncertainty will affect firms' price setting behaviours.

Please use this identifier to cite or link to this item:

http://hdl.handle.net/10453/119323