| Status | 已發表Published |
| Decisions of Real Estate Developers Under Uncertainty and Heterogeneous Beliefs | |
Lai, R. ; Xu, R.
| |
| 2016-07-01 | |
| Source Publication | 8th Global Chinese Real Estate Congress Annual Conference Proceeding
 |
| Abstract | We develop a theoretical model that studies the effects of real estate developers' heterogeneous beliefs on demand uncertainty on construction and sale decisions. As expected, optimistic developers construct more houses when facing higher uncertainty, while pessimistic developers construct less. Higher housing quality resemblance leads to lower pricing power of developers. Considering developers' updating of beliefs, our model further identify the value of overconfidence in investors’ profit-maximizing choices, and how it is affected by demand uncertainty. Moreover, entrance of new developers into the market does not necessarily yield higher total supply. This paper provides additional insights into overbuilding, inventory holding and other puzzling phenomena in real estate markets |
| Keyword | Uncertainty Heterogeneous Beliefs Real Estate Developer Optimism |
| Language | 英語English |
| The Source to Article | PB_Publication |
| PUB ID | 21756 |
| Document Type | Conference paper |
| Collection | HONOURS COLLEGE |
| Recommended Citation GB/T 7714 | Lai, R.,Xu, R.. Decisions of Real Estate Developers Under Uncertainty and Heterogeneous Beliefs[C], 2016. |
| APA | Lai, R.., & Xu, R. (2016). Decisions of Real Estate Developers Under Uncertainty and Heterogeneous Beliefs. 8th Global Chinese Real Estate Congress Annual Conference Proceeding. |
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