File Download
  Links for fulltext
     (May Require Subscription)
Supplementary

Article: What Motivates a Developer to Sell before Completion?

TitleWhat Motivates a Developer to Sell before Completion?
Authors
Issue Date2018
PublisherSpringer New York LLC. The Journal's web site is located at http://springerlink.metapress.com/openurl.asp?genre=journal&issn=0895-5638
Citation
Journal of Real Estate Finance and Economics, 2018, Epub of 2018 How to Cite?
AbstractPresale, or selling before completion, is a very common phenomenon in the housing market. However, not all developers presell their units and the proportion of units presold varies over time and across projects. This study examines the factors that affect developers’ decisions to presell their units. Based on housing transaction records on over 1000 projects in Hong Kong, we found that presale has been used as a tool to hedge against future price fluctuations. Developers’ decisions to presell also depend on its effectiveness as a hedging tool, which increases with the size of the development portfolio held by a developer. When the flexibility of a presale is constrained by regulations, its effectiveness declines, thus giving a developer less incentive to presell. Contrary to industry wisdom, presale is not an important source of financing, at least for listed developers in Hong Kong.
Persistent Identifierhttp://hdl.handle.net/10722/263398
ISSN
2017 Impact Factor: 1.136
2015 SCImago Journal Rankings: 1.144

 

DC FieldValueLanguage
dc.contributor.authorLI, L-
dc.date.accessioned2018-10-22T07:38:16Z-
dc.date.available2018-10-22T07:38:16Z-
dc.date.issued2018-
dc.identifier.citationJournal of Real Estate Finance and Economics, 2018, Epub of 2018-
dc.identifier.issn0895-5638-
dc.identifier.urihttp://hdl.handle.net/10722/263398-
dc.description.abstractPresale, or selling before completion, is a very common phenomenon in the housing market. However, not all developers presell their units and the proportion of units presold varies over time and across projects. This study examines the factors that affect developers’ decisions to presell their units. Based on housing transaction records on over 1000 projects in Hong Kong, we found that presale has been used as a tool to hedge against future price fluctuations. Developers’ decisions to presell also depend on its effectiveness as a hedging tool, which increases with the size of the development portfolio held by a developer. When the flexibility of a presale is constrained by regulations, its effectiveness declines, thus giving a developer less incentive to presell. Contrary to industry wisdom, presale is not an important source of financing, at least for listed developers in Hong Kong.-
dc.languageeng-
dc.publisherSpringer New York LLC. The Journal's web site is located at http://springerlink.metapress.com/openurl.asp?genre=journal&issn=0895-5638-
dc.relation.ispartofJournal of Real Estate Finance and Economics-
dc.rightsThe final publication is available at Springer via http://dx.doi.org/[insert DOI]-
dc.rightsThis work is licensed under a Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License.-
dc.titleWhat Motivates a Developer to Sell before Completion?-
dc.typeArticle-
dc.description.naturepublished_or_final_version-
dc.identifier.doi10.1007/s11146-018-9662-3-
dc.identifier.hkuros295470-
dc.identifier.volumeEpub of 2018-
dc.publisher.placeUnited States-

Export via OAI-PMH Interface in XML Formats


OR


Export to Other Non-XML Formats