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SEQUENTIAL SALES OF SIMILAR ASSETS: THE LAW OF ONE PRICE AND REAL ESTATE
Author(s) -
Munneke Henry,
Ooi Joseph T.L.,
Sirmans C.F.,
Turnbull Geoffrey K.
Publication year - 2011
Publication title -
journal of regional science
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.171
H-Index - 79
eISSN - 1467-9787
pISSN - 0022-4146
DOI - 10.1111/j.1467-9787.2010.00691.x
Subject(s) - real estate , sequence (biology) , consumption (sociology) , economics , business , law of one price , price on application , microeconomics , financial economics , monetary economics , mid price , commerce , price level , real estate investment trust , capitalization rate , finance , social science , genetics , sociology , biology
The housing literature largely overlooks the price evolution of similar assets sold sequentially, even though such sales often occur with new residential developments. The law of one price implies no persistent price pattern for identical assets sold sequentially. Nonetheless, the auction and nonauction literatures reveal conditions leading to sales sequence effects on prices. This paper examines price evolution in the condominium market where similar units are sold sequentially in a setting with minimal consumption risk. The results indicate no pervasive sequence–price relationship for sequential sales of similar property units.