Developer’s Perceptions of the Market, the Market Players and Market Factors
||Nell, Chang; Tim Havard
||Developer’s Perceptions of the Market, the Market Players and Market Factors
||14th Annual European Real Estate Society Conference in London, UK
||Literature has identified over 100 variables that determine property prices, against a predominant belief that major property price determinants are “location, location, location”. Behavioural school of thought in valuation believes that practitioners / academics should reflect market behaviour, but there is little research into how market players perceive those factors. This research investigates developers’ perceptions of the market, the market factors and the market players. Findings come from 27 in-depth interviews of professionals representing 21 developers in the immature Beijing market and mature Hong Kong market. It reveals location, social class, economy and distance to transport are common major price determinants to the developers from both mature and immature markets, while in total 48 factors are suggested as the top 5 price determinants. One significant finding is that developers consider factors in groups under broad-term that not only include various factors but have differing definitions between developers. Over 20 board-term factors are suggested to constitute the term location, including nearly all financial, environmental and property factors; raising the question of whether developers have given too broad a definition to location. This questions developers’ belief that professionals share same opinions. Unexpected factors are revealed as Hong Kong developers believe their reputation is a major price determinant and they have great influence on the market, price and owners; while Beijing developers believe owners are immature, have no opinions of their own but have opinions come from developers; showing a different yet similar common confidence that might not be supported by sales phenomenon.
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||Session F2: Real Estate Development I
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