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Analysis of the Characteristics of Individual Investors in Real Estate Securities and Income‐Producing Property
Author(s) -
Srivastava Rajendra K.,
Isakson Hans R.,
Price Linda,
McInish Thomas H.
Publication year - 1984
Publication title -
real estate economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.064
H-Index - 61
eISSN - 1540-6229
pISSN - 1080-8620
DOI - 10.1111/1540-6229.00336
Subject(s) - real estate , capitalization rate , cost approach , income approach , renting , real estate investment trust , property (philosophy) , business , investment (military) , corporate real estate , finance , economics , real estate development , actuarial science , financial economics , philosophy , epistemology , politics , political science , law
Analysis of the responses to a nationwide survey of investors demonstrates that individuals who invest in real estate differ in a predictable way from those who invest in assets other than real estate. Two types of real estate investment vehicles are studied: income‐producing (rental) property and real estate securities. A multiple group discriminant analysis model is presented which successfully classifies prospective investors into four groups (owners of income property only, real estate securities only, both, neither) with a predictive accuracy more than double the chance probability of correct classification. The results provide insights useful in policy analysis and the design and marketing of real estate investments.