Changing Rates of Return on Rental Property and Condominium Conversions

Theodore M. Crone
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Theodore M. Crone: Federal Reserve Bank of Philadelphia

Urban Studies, 1988, vol. 25, issue 1, 34-42

Abstract: In the 1970s about 350,000 housing units in multi-family structures in the US were converted to a condominium or co-operative form of ownership. This paper shows how changes in both rents and housing prices influence the expected rate of return on rental property and therefore the probability of conversion. A minimum logit chi-square model was applied to data from 34 metropolitan areas to estimate the effects of these changes. The evidence suggests that changes in housing prices had a greater effect on conversions than changes in the expected net return on rental property.

Date: 1988
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Persistent link: https://EconPapers.repec.org/RePEc:sae:urbstu:v:25:y:1988:i:1:p:34-42

DOI: 10.1080/00420988820080031

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