EconPapers    
Economics at your fingertips  
 

Loss Aversion and Seller Behavior: Evidence from the Housing Market

David Genesove and Christopher Mayer

The Quarterly Journal of Economics, 2001, vol. 116, issue 4, 1233-1260

Abstract: Data from downtown Boston in the 1990s show that loss aversion determines seller behavior in the housing market. Condominium owners subject to nominal losses 1) set higher asking prices of 25–35 percent of the difference between the property's expected selling price and their original purchase price; 2) attain higher selling prices of 3–18 percent of that difference; and 3) exhibit a much lower sale hazard than other sellers. The list price results are twice as large for owneroccupants as investors, but hold for both. These findings suggest that sellers are averse to realizing (nominal) losses and help explain the positive price-volume correlation in real estate markets.

Date: 2001
References: Add references at CitEc
Citations: View citations in EconPapers (852)

Downloads: (external link)
http://hdl.handle.net/10.1162/003355301753265561 (application/pdf)
Access to full text is restricted to subscribers.

Related works:
Working Paper: Loss Aversion and Seller Behaviour: Evidence from the Housing Market (2001) Downloads
Working Paper: Loss Aversion and Seller Behavior: Evidence from the Housing Market (2001) Downloads
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:oup:qjecon:v:116:y:2001:i:4:p:1233-1260.

Ordering information: This journal article can be ordered from
https://academic.oup.com/journals

Access Statistics for this article

The Quarterly Journal of Economics is currently edited by Robert J. Barro, Lawrence F. Katz, Nathan Nunn, Andrei Shleifer and Stefanie Stantcheva

More articles in The Quarterly Journal of Economics from President and Fellows of Harvard College
Bibliographic data for series maintained by Oxford University Press ().

 
Page updated 2025-03-19
Handle: RePEc:oup:qjecon:v:116:y:2001:i:4:p:1233-1260.