Aaltodoc publication archive (Aalto University institutional repository)
School of Business | Department of Finance | Finance | 2013
Thesis number: 14473
Analysis of expected sale time and behavior on the Finnish housing market
|Title:||Analysis of expected sale time and behavior on the Finnish housing market|
|Year:||2013 Language: eng|
|Department:||Department of Finance|
|Index terms:||rahoitus; financing; asunnot; apartments; kiinteistöt; real estates; markkinat; markets; myynti; sales; aika; time|
» hse_ethesis_14473.pdf size:2 MB (1500075)
|Key terms:||housing market; time-on-market; submarkets; market characteristics; behavior|
PURPOSE OF THE STUDY
The purpose of this thesis is to determine how expected sale time of housing in Finland is formed and which factors have an effect on it. I use marketing time of dwellings as a proxy of expected sale time. This is a descriptive study in nature, because no earlier papers with Finnish data exist to compare the results with. The analysis covers housing features as well as its location. In addition, I study macro-economy and date of market entry related variables' effects on expected sale time. For most individuals, housing transactions are largest investment decisions of their lives and I aim to explain the high variation in the sale times within the Finnish housing market and in comparison with other asset classes.
I study my research questions mainly based on housing advertisements from January 2004 to July 2012. The advertisement data was collected from three sources: Etuovi, Oikotie and Kiinteistömaailma. In addition, I collected real transaction data from asuntojen.hintatiedot.fi and various background data from Statistics Finland.
The results show that nearly all available housing and listing date related features have a statistically significant relationship with expected sale time. I also find that submarkets within certain cities do not vary much from the city consensus and more variation is present at times with poor state of economy. Results suggest that a seller with no rush to sell should wait for the optimal listing time to ensure her dwelling to raise interest in the market. I find that buyers' search criteria selection has a clear link to expected sale time as well. With a careful selection of listing price the seller may lower her dwelling's expected sale time.
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