Abstract
| Original language | English |
|---|---|
| Pages (from-to) | 339-361 |
| Number of pages | 23 |
| Journal | Housing Studies |
| Volume | 29 |
| Issue number | 3 |
| Early online date | 10 Apr 2013 |
| DOIs | |
| Publication status | Published - Apr 2014 |
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Keywords
- auctions
- bid-premium
- Housing markets
- price expectations
ASJC Scopus subject areas
- Environmental Science (miscellaneous)
- Sociology and Political Science
- Urban Studies
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Expectation Adjustment in the Housing Market : Insights from the Scottish Auction System. / Thanos, Sotirios; White, Michael .
In: Housing Studies, Vol. 29, No. 3, 04.2014, p. 339-361.Research output: Contribution to journal › Article
TY - JOUR
T1 - Expectation Adjustment in the Housing Market
T2 - Insights from the Scottish Auction System
AU - Thanos, Sotirios
AU - White, Michael
PY - 2014/4
Y1 - 2014/4
N2 - This paper examines price expectation adjustment of house buyers and sellers to rapid changes in the housing market using data from Scotland where houses are sold through ‘first-price sealed-bid’ auctions. These auctions provide more information on market signals, incentives and the behaviour of market participants than private treaty sales. This paper therefore provides a theoretical framework for analysing revealed preference data generated from these auctions.We specifically focus on the analysis of the selling to asking price difference, the ‘bid-premium’. The bid-premium is shown to be affected by expectations of future price movements, market duration and high bidding frequency. The bid-premium reflects consumer’s expectations, adapting to market conditions more promptly than asking price setting behaviour and final sale prices. The volatile conditions of the recent housing market bubble are fully reflected in the bid-premium, whereas the asking and sale prices are much less prone to rapid movements.
AB - This paper examines price expectation adjustment of house buyers and sellers to rapid changes in the housing market using data from Scotland where houses are sold through ‘first-price sealed-bid’ auctions. These auctions provide more information on market signals, incentives and the behaviour of market participants than private treaty sales. This paper therefore provides a theoretical framework for analysing revealed preference data generated from these auctions.We specifically focus on the analysis of the selling to asking price difference, the ‘bid-premium’. The bid-premium is shown to be affected by expectations of future price movements, market duration and high bidding frequency. The bid-premium reflects consumer’s expectations, adapting to market conditions more promptly than asking price setting behaviour and final sale prices. The volatile conditions of the recent housing market bubble are fully reflected in the bid-premium, whereas the asking and sale prices are much less prone to rapid movements.
KW - auctions
KW - bid-premium
KW - Housing markets
KW - price expectations
UR - http://www.scopus.com/inward/record.url?scp=84896521797&partnerID=8YFLogxK
U2 - 10.1080/02673037.2013.783200
DO - 10.1080/02673037.2013.783200
M3 - Article
VL - 29
SP - 339
EP - 361
JO - Housing Studies
JF - Housing Studies
SN - 0267-3037
IS - 3
ER -