What kind of demands does a new real estate growth make on real estate quality in Estonia?
||Kolbre, Ene; Kallakmaa-Kapsta, Angelika
||What kind of demands does a new real estate growth make on real estate quality in Estonia?
||18th Annual European Real Estate Society Conference in Eindhoven, the Netherlands
||The Estonian real estate market has experienced a decline and stabilisation phase and started on a new rise. In the real estate market decline phase it was discovered that the prices of low quality objects have fallen the most or these objects are still unsold. This paper seeks to investigate the opinions of market participants about the real estate quality and make a hierarchy of quality indicators under the new real estate boom. The object of analysis is the housing and office market. Real estate quality is assessed on the basis of the Quality Rating System, according to what a quality grade characterises the objectís competitiveness to be attractive for similar type of investors or tenants. Quality grade for a real estate object is determined on the basis of its income potential, taking into consideration the sustainability of the object, i.e. every factor has to be assessed based on the principles of sustainable development and saving use. Income potential is evaluated on the basis of the following attributes: location and use of the plot, quality of construction and real estate management. Valuation of each attribute is based on the factors that influence the respective attribute. The choice of factors influencing the attributes depends on the type of object to be valued: residential or office. Analysis of a real estate object identifies the hierarchy of factors that influence the quality of living and office space, assessed separately for investors, tenants and real estate appraisers, and the results are compared with the past assessments of the real estate quality. To evaluate the hierarchy of the factors influencing the quality grade of the real estate object, the Analytic Hierarchy Process (AHP) method is used.
||quality, rating system, real estate market
||file.pptx (234,459 bytes)
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||B2: Market Research, Analysis and Forecasting (II)
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