Equity and Time to Sale in the Real Estate Market

David Genesove and Christopher Mayer

American Economic Review, 1997, vol. 87, issue 3, 255-69

Abstract: Evidence from the Boston condominium market of the early 1990s reveals that an owner's equity position determines his experience as a seller. An owner of a property with a high loan-to-value ratio sets a higher asking price, has a higher expected time on the market and, if he sells, receives a higher price than an owner with proportionately less debt. The down payment requirement for purchasers, but not incumbent owners, provides a simple explanation for this phenomenon among owner-occupants. The results provide supporting evidence for equity-based aggregate theories of price- volume movements in the housing market. Copyright 1997 by American Economic Association.

Date: 1997
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Related works:
Working Paper: Equity and Time to Sale in the Real Estate Market (1994)
Working Paper: Equity and Time to Sale in the Real Estate Market (1994)
Working Paper: Equity and time to sale in the real estate market (1993)
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