 How many listings are too many? Agent inventory externalities and the residential housing marketXun Bian, Bennie D. Waller, Geoffrey K. Turnbull and Scott A. Wentland Journal of Housing Economics, 2015, vol. 28, issue C, 130-143 Abstract: Given the significant role of real estate agents in the housing market, this study examines how agents’ incentives regarding the size of their listing inventories indirectly affect residential home prices and liquidity. The theory shows that taking on additional inventory generates a critical principal–agent issue, resulting in the dilution of an agent’s selling effort and, ultimately, creating an externality that adversely impacts housing market outcomes across listings. It remains an empirical question whether diluted sales effort leads to lower prices, longer time on market, or both. The empirical results reveal significant inventory externality effects, as greater agent inventory tends to reduce selling price and substantially reduce liquidity for clients’ properties in this market. Keywords: Residential housing; House prices; House liquidity; Principal–agent problem; Moral hazard; Asymmetric information (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:jhouse:v:28:y:2015:i:c:p:130-143 DOI: 10.1016/j.jhe.2015.04.002 Access Statistics for this article Journal of Housing Economics is currently edited by H. O. Pollakowski More articles in Journal of Housing Economics from Elsevier |
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