Our study investigates the role of speculation in real estate cycles. We find that even a simple model of lagged supply response to price changes and speculation is sufficient to generate real estate cycles. Second, the volatility of prices – the biggest purported downside of “speculation”...

There has been a great deal of interest in whether value-added and opportunistic real estate investing has resulted in appropriate risk-adjusted returns. In this paper, data from the National Council of Real Estate Investment Fiduciaries (NCREIF) property database are examined to bring new...