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Transaction Costs and Housing Affordability in Asia


  • Prince Christian R. Cruz

    () (Global Property Guide, Makati City, Philippines)


Asia is home to some of the fastest growing cities in the world. As urbanization increases, demand for housing also increases. Well functioning housing markets can minimize problems associated with rapid urbanization such as unaffordable housing and urban slums. This paper explores the different aspects of the residential property sales markets in Asian countries. Using data gathered by the Global Property Guide, transaction costs associated with residential property purchases are analyzed. Housing markets are also examined in terms of tenure, protection of property rights, and openness and transparency. Roundtrip transaction costs for buying properties are high, above 10% in several countries in Asia. High transaction costs and unaffordable housing combined with weak protection of property rights are seen to be conducive to the creation of urban slums.

Suggested Citation

  • Prince Christian R. Cruz, 2008. "Transaction Costs and Housing Affordability in Asia," International Real Estate Review, Asian Real Estate Society, vol. 11(1), pages 128-150.
  • Handle: RePEc:ire:issued:v:11:n:01:2008:p:128-150

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    References listed on IDEAS

    1. Edward L. Glaeser & Joseph Gyourko & Raven E. Saks, 2006. "Urban growth and housing supply," Journal of Economic Geography, Oxford University Press, vol. 6(1), pages 71-89, January.
    2. Pablo Casas-Arce & Albert Saiz, 2006. "Owning versus leasing: do courts matter?," Working Papers 06-21, Federal Reserve Bank of Philadelphia.
    3. Glaeser, Edward L. & Kahn, Matthew E., 2004. "Sprawl and urban growth," Handbook of Regional and Urban Economics,in: J. V. Henderson & J. F. Thisse (ed.), Handbook of Regional and Urban Economics, edition 1, volume 4, chapter 56, pages 2481-2527 Elsevier.
    4. DiPasquale, Denise, 1999. "Why Don't We Know More about Housing Supply?," The Journal of Real Estate Finance and Economics, Springer, vol. 18(1), pages 9-23, January.
    5. Ballesteros, Marife M., 2001. "The Dynamics of Housing Demand in the Philippines: Income and Lifecycle Effects," Discussion Papers DP 2001-15, Philippine Institute for Development Studies.
    6. Natalya Delcoure & Norm G. Miller, 2002. "International Residential Real Estate Brokerage Fees and Implications for the US Brokerage Industry," International Real Estate Review, Asian Real Estate Society, vol. 5(1), pages 12-39.
    7. James A. Robinson & Daron Acemoglu, 2000. "Political Losers as a Barrier to Economic Development," American Economic Review, American Economic Association, vol. 90(2), pages 126-130, May.
    8. Acemoglu,Daron & Robinson,James A., 2009. "Economic Origins of Dictatorship and Democracy," Cambridge Books, Cambridge University Press, number 9780521671422, March.
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    Cited by:

    1. Doling, John & Vandenberg, Paul & Tolentino, Jade, 2013. "Housing and Housing Financeā€”A Review of the Links to Economic Development and Poverty Reduction," ADB Economics Working Paper Series 362, Asian Development Bank.
    2. Xiaolong Liu & Weidong Qu, 2015. "Winner's Curse or Signaling? Bidding Outcomes in the Chinese Land Market," International Real Estate Review, Asian Real Estate Society, vol. 18(1), pages 113-129.
    3. (No last name available), Himanshu, 2013. "Poverty and Food Security in India," ADB Economics Working Paper Series 369, Asian Development Bank.
    4. Debuque-Gonzales, Margarita, 2013. "Empirical Determinants and Patterns of Research and Development Investment in Asia," ADB Economics Working Paper Series 364, Asian Development Bank.

    More about this item


    Property markets; Transaction costs; Housing affordability; Slums;

    JEL classification:

    • L85 - Industrial Organization - - Industry Studies: Services - - - Real Estate Services


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