Behavioural Real Estate

The behavioural approach to decision making under uncertainty combines insights from psychology and sociology into economic decision making. It steps away from the normative homo economicus and introduces a positive approach to human decision making under uncertainty. We provide an overview of the main themes in the behavioural real estate literature from the perspective of different market participants. It can be concluded that there seems to be general agreement that behavioural studies can help explain the inefficiency of real estate markets, but a large component of behavioural decision making in the property markets seems to be undiscovered.