IDEAS home Printed from https://ideas.repec.org/a/taf/jpropr/v17y2000i2p147-168.html
   My bibliography  Save this article

The influence of uncertainty on house builder behaviour and residential land values

Author

Listed:
  • Chris Leishman
  • Colin Jones
  • Will Fraser

Abstract

House builders are the interface between the land and housing markets, determining present land values by forecasting future house prices and construction costs. The literature establishes that land values are derived from house prices and construction costs but that this relationship may be altered by uncertainty, yet very little analysis has been provided to establish this empirically. A model of house builder behaviour is proposed and tested through detailed empirical analysis of a sample of private house building projects. Methods of estimating the development values and costs associated with individual sites are set out and rates of achieved profit are estimated. Using simulation methods, the paper demonstrates the effects of house builders' forecasting behaviour on land values, and evidence is presented that house builders' behaviour in the land and housing markets depresses the price of land. It is concluded that house builders tend to forecast conservatively with the result that land is undervalued.

Suggested Citation

  • Chris Leishman & Colin Jones & Will Fraser, 2000. "The influence of uncertainty on house builder behaviour and residential land values," Journal of Property Research, Taylor & Francis Journals, vol. 17(2), pages 147-168, January.
  • Handle: RePEc:taf:jpropr:v:17:y:2000:i:2:p:147-168
    DOI: 10.1080/095999100367967
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1080/095999100367967
    Download Restriction: Access to full text is restricted to subscribers.

    File URL: https://libkey.io/10.1080/095999100367967?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Alan W. Evans, 1995. "The Property Market: Ninety Per Cent Efficient?," Urban Studies, Urban Studies Journal Limited, vol. 32(1), pages 5-29, February.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Nicholas R Magliocca & Daniel G Brown & Virginia D McConnell & Joan I Nassauer & S Elizabeth Westbrook, 2014. "Effects of Alternative Developer Decision-Making Models on the Production of Ecological Subdivision Designs: Experimental Results from an Agent-Based Model," Environment and Planning B, , vol. 41(5), pages 907-927, October.
    2. Ali Azadeh & Mohammad Sheikhalishahi & Ali Boostani, 2014. "A Flexible Neuro-Fuzzy Approach for Improvement of Seasonal Housing Price Estimation in Uncertain and Non-Linear Environments," South African Journal of Economics, Economic Society of South Africa, vol. 82(4), pages 567-582, December.
    3. O’Brien, Philip & Lord, Alex & Dembski, Sebastian, 2020. "How do planners manage risk in alternative land development models? An institutional analysis of land development in the Netherlands," Land Use Policy, Elsevier, vol. 91(C).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Zan Yang & Shuping Wu, 2019. "Land acquisition outcome, developer risk attitude and land development timing," The Journal of Real Estate Finance and Economics, Springer, vol. 59(2), pages 233-271, August.
    2. Gunther Maier & Shanaka Herath, 2009. "Real Estate Market Efficiency: A Survey of Literature," SRE-Disc sre-disc-2009_07, Institute for Multilevel Governance and Development, Department of Socioeconomics, Vienna University of Economics and Business.
    3. George Matysiak & Gerald Brown, 1997. "A time-varying analysis of abnormal performance of UK property companies," Applied Financial Economics, Taylor & Francis Journals, vol. 7(4), pages 367-377.
    4. Agnieszka Małkowska & Małgorzata Uhruska & Mateusz Tomal, 2019. "Age and Experience versus Susceptibility to Client Pressure among Property Valuation Professionals—Implications for Rethinking Institutional Framework," Sustainability, MDPI, vol. 11(23), pages 1-23, November.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:taf:jpropr:v:17:y:2000:i:2:p:147-168. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Chris Longhurst (email available below). General contact details of provider: http://www.tandfonline.com/RJPR20 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.