Although the internal rate of return (IRR) represents the most widely used measure of performance, some controversy issues about its interpretation as real estate funds performance ratio, are here debated. The aim of the paper is to review these issues and, at the same time, to suggest some IRR...

This study investigates why externally advised Real Estate Investment Trusts (REITs) underperform their internally managed counterparts. Consistent with previous studies, we find that REITs managed by external advisors underperform internally managed ones by over 7% per year. Property-level cash...

In this study, we explore the role of expected cash flow volatility as a determinant of dividend policy. We first demonstrate that returns are increasing in dividend payout. But, we show that responses to changes in dividends are less sensitive to the magnitude of the change than to the sign of...

A firm can be viewed as a portfolio of projects arising from capital budgeting decisions. How these projects are bundled, i.e. managerial style, affects administrative costs and firm value. We analyze the effect of style on firm value using a panel data set of 75 publicly-traded REITs over eight...

The recent global financial crisis, sparked by developments in the American mortgage market, provides a timely opportunity for a thorough analysis of the standard model for financing home purchases. The United States residential mortgage market has two prominent aspects: first, a significant...

While several studies have documented behavioral biases in the behavior of individual investors, very little is known about the existence of such biases in corporations. We utilize the unique nature of Real Estate Investment Trusts (REITs) to test for the presence of one of the most widely...

This study documents the publicly traded equity Real Estate Investment Trust (REIT) universe during the modern REIT era (early 1990s through the present). We show the growth and consolidation of the industry, changes in property type focus, increases in institutional ownership, and the growth of...

This paper documents developments in mortgage credit and the housing sector in Latin America over the past decade, and compares them with those of other emerging economies. In particular, it examines the real estate and mortgage markets to assess whether (i) growth in mortgage credit is...

The tenure decision upon whether to buy or to rent accommodation has long-term consequences for households' financial wellbeing that influence macroeconomic development and stability when the cumulative effects of individual decisions are aggregated across populations. The author explains how...

The Gordon Growth Model is used to derive widely differing fundamental values of the same gross rental yield for six hypothetical housing purchasers listed in declining order of magnitude: a fully funded consumer with a marginal tax rate of 40%, a fully funded buy to let investor with a marginal...