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2010, Vol.20, No.2

  • 1.

    The Effect of Land Revaluation on Stock Price during Economic Crisis

    Joo Hyun Cho | 이찬호 | 2010, 20(2) | pp.7~28 | number of Cited : 2
    Abstract
    This study has analyzed how real estate revaluation which had been allowed ahead of the compulsory introduction on the International Financial Reporting Standards (IFRS) in 2011 influences the stock price. In order to analyze the more obvious effect on stock price caused by the real estate revaluation, first, we separated the year 1998 which was just after the financial crisis from the year 2008 which accepted the early introduction of International Financial Reporting Standards. In addition, we analyze the effect of stock price caused by real estate revaluation in four kinds of situations through distinguishing the KOSPI-listed corporations from the KOSDAQ- listed companies each year. The results of analysis are mainly summarized as the followings. First, in the analysis of the relationship between real estate revaluation and stock price on the KOSPI-listed corporations and KOSDAQ-listed companies in each year 1998 and 2008, the positive(+) relationship was found between real estate revaluation and stock price in all circumstances except for 1998 KOSDAQ-listed companies. Second, to analyze whether the positive(+) relationship between the real estate revaluation and the stock price is different according to company characteristics or not, the model has included debt ratio, ratio of land and condition of net loss during the term as variables of company characteristics, we found that the higher is debt ratio, the greater is the improvement effect of stock price caused by real estate revaluation. Third, according to the analysis of the relationship between real estate revaluation and future stock price, the significant positive(+) relationship was found in KOSPI-listed corporations only in one year after revaluation.
  • 2.

    Effects of Land Use De-regulations on Land Prices: An Empirical Analysis

    정희남 | Moon, Tae Hoon | Suh,Seoung Hwan | 2010, 20(2) | pp.29~50 | number of Cited : 1
    Abstract
    An imbalance in the demand and supply of urban land has been followed by land price increase and cyclical land speculation. To address the chronic imbalance between the demand and supply of urban land, the government decided to supply 3,000㎢ of urban land by the year of 2020. Toward this end, the government eased land use regulations on farm land, mountainous areas, greenbelt areas, and military facilities protection districts amounting to 2,719㎢ in 2008. This policy is based on the premise that land prices will be stabilized when developable land increases following the land use deregulation. To analyze empirically the impacts of land use deregulation on land prices, this study carried out conventional econometrics model analysis and dynamic system dynamics analysis. The provisional conclusion of the empirical analyses can be summarized as follows: First, although land use deregulation has an impact on land price stability, the effect on the total land market is quite limited contrary to general expectations. Note, however, that higher land price stabilization effect is noted in the Seoul Metropolitan Area where land demand is relatively higher and land regulation is relatively stricter. As such, land use deregulation limited to some regions may be more effective than applying it nationwide. Second, the prices of land targeted for deregulation rise because deregulation is accompanied by the use conversion of the relevant land. This implies that a land market stabilization policy should be simultaneously implemented along with the deregulation. Third, shortening the urban land supply period was more effective for land market stabilization rather than deregulation itself. Accordingly, effort at the policy level to simplify complex administrative procedures further along with land use deregulation is necessary.
  • 3.

    Market Efficiency Test of Pre-sale and Existing House on Seoul Metropolitan Area

    kyu hyun Ji | Choi, Sung Ho | 2010, 20(2) | pp.51~63 | number of Cited : 5
    Abstract
    This paper has the objective of measuring the price-volume relationship between the pre-sale and existing market in Seoul metropolitan area. We modified the conventional housing stock-flow model to test the relationship. Major findings are: 1) housing price work to reduce the gap between demand and supply in Gyeonggi province; however, the existing price adjusts faster than the pre-sale price; 2) in case of Seoul, pre-sale price work inefficient; and 3) the housing stock at t-1 is related to the new supply from the pre-sales market in Seoul metropolitan area; however, new supply in Gyeonggi province adjusts faster than in Seoul.
  • 4.

    An Empirical Study on the Relationships Between Corporate Real Estate Ownership and the Price Book Value Ratio

    정완성 | 2010, 20(2) | pp.65~89 | number of Cited : 13
    Abstract
    The purpose of this study is to investigate the effects of corporate real estate holding ratio on price book value ratio in Korea between the years 1999-2008. In addition, this study examines different impact of corporate real estate holding ratio on firm value in various industry sectors. Goal in this study is to find out corporate real estate holding strategy in industry sectors. This empirical analysis is based on data from KISVALUE III. Dataset comprises 1,101 firms during 1999-2008. This empirical analysis is carried out in order to find out influence of corporate real estate holding ratio by selecting variables such as PBR, firm size, leverage, market and industry dummy. Results of this empirical work is carried out by using Multiple Regression Analysis and Chow test. We discover a generally negative relationship between real estate holding and price book value ratio, but this impact is differently appeared in various industry sectors. In the Chow test and dummy variable test, The data are divided into two periods by 1999 to 2003 and 2004 to 2008. And the test is applied to PBR using the real estate holding ratio as explanatory variable. The result of Chow test shows that there exists a structural change between the regression models.
  • 5.

    A Study of Relation between the Fluctuation of Real Estate Market and the Assets Management of Mutual Saving Banks

    kim, won-hee | Kang, Won-Chul | 2010, 20(2) | pp.91~106 | number of Cited : 5
    Abstract
    This study analyses empirically the relation between the fluctuation of real estate market and the assets management of mutual saving banks. The data used in this study are half year data from June 2000 to end of 2009, therefore the number of observation is 19. In the assets management, mutual saving banks cope with the fluctuation of real estate market in a different way in comparison with that of banks, especially we confirm empirically that the assets management of them is neutral to the fluctuation of real estate market in Korea. This is caused that they have no other alternate method of assets management. Therefore, the assets management of mutual saving banks can bring about a heavy risk on themselves in the recession of real estate market.
  • 6.

    GWR Approach for Real Estate Appraisal: The Case of Seoul Apartment

    강창덕 | 2010, 20(2) | pp.107~132 | number of Cited : 23
    Abstract PDF
    This study aims to suggest how to apply Geographically Weighted Regression to real estate appraisal through empirical research for Seoul apartment market. Five key conclusions can be drawn based on the GWR modeling. First, this study confirms that housing market in Seoul might contain diverse types of submarkets in terms of housing attributes, transportation and location, amenity, education attributes, and socioeconomic characteristics. These findings would be considered in housing appraisal. Second, the GWR model found the spatial variation of each characteristics of Seoul apartment. The result would complement the caveat of hedonic price models. Third, real estate appraisers would consider the weight on each attributes of housing from spatially-varied relation between housing price and characteristics. Fourth, the local R-Square value from GWR models reveals whether aspatial or non quantitative variables determine housing price. Finally, the GWR modeling using apartment market price and statistical inference technique would apply to local housing price index.
  • 7.

    Analysis on the Determinants of the Cap Rate in Seoul Office Market using the Vector Error Correction Model

    Lee, Su-Jeong | Joo Hyun Cho | 2010, 20(2) | pp.133~152 | number of Cited : 25
    Abstract
    The capitalization rate(Cap Rate) is used as the investment indicator of the institutional investors needed in making a reasonable investment decision and is a meaningful indicator to the real estate market. Recently, foreign studies have shown that the capital market has tended to have a gradually increasing effect on the Cap Rate of the office building. This study includes theoretical investigation of the Cap Rate as well as analyzing what effect the macroeconomic factors of the capital market had on it. And it attempted to analyze the Cap Rate determinants of the Seoul office market using the Vector Error Correction Model. As a result, it was found that the Cap Rate was influenced by the corporate bond, one of macroeconomic variables, and by office supply, those of the variables related to real estate market. The Cap Rate spread is a deduction of the risk-free rate from the Cap Rate and influenced by KOSPI as one of macroeconomic variables, and office supply as one of the variables related to real estate market. The results of variance decomposition showed that both the Cap Rate and the Cap Rate spread had the absolutely high explanatory power of such macroeconomic variables as KOSPI and corporate bond than real estate market related variables. This result shows that the Cap Rate of the Seoul office market had the phenomenon of synchronizing with the capital market.
  • 8.

    A Study on the Improvement of Income Approach in Commercial Land Price Notification

    Choi, Tae Kyu | Lee,Choon-Sup | 2010, 20(2) | pp.153~176 | number of Cited : 2
    Abstract
    This study examines some problems and their improvement in the model of income approach for the Commercial Land Price Notification through theoretical and objective analysis. The issue of Korean Model distinguishes between land and building’s NOI, violates the principle of vacant assumption appraisal and the Highest and Best Use. This study propose the improvement like following direction. There are Real Estate Residual Capitalization Methode Model, Cap rate and Discount rate have to investigate for the Commercial Land Price Notification.
  • 9.

    Analysis of Decision Making Factor for Contractor's Bid Participation in Urban Re-Development and Re-Construction Projects

    Ji, So Young | Sangyoub Lee | 2010, 20(2) | pp.177~192 | number of Cited : 3
    Abstract
    Financial crisis and following depression of real estate market for last few years have caused a freeze on construction business in public housing industry, and only successful bidders for contract can maintain construction business. Therefore this paper explores key considering decision factors of participation for contract bidding for housing redevelopment and reconstruction business with contractor’s view to select the suitable project. This paper analyze the bidding data of all the domestic housing projects since 2004 by Binary Logistic Regression method and it also covers relevant study literature review. A dependent variable Y is a decision of participation for contract bidding, and Gross Floor Area(GFA), A Facility(AF), Ordinary Income(OI), Region(R), Member’s Cost(MC), Rental Ratio (RR), Interest Rate(IR) and Construction Period(CP) were used as independent variables for logistic model. Independent variable of OI, GFA, and IR can satisfy valid level (5%), and they have influence on participation decision for contract bidding in the order, and for negative coefficient, the lower value can result in the more positive decision for participation. AF is out of valid level, but it has high impact for decision, and also it proves that Seoul and/or other capital region have the more privilege regionally. The paper statistically proves that derived independent variables from study are critical decision factors for participation of contract bidding for redevelopment and reconstruction of housing business. However insufficient data from company A, compared with the number of variables need to be reviewed for next study together with environmental location and marketability for sales as decision factors.
  • 10.

    The Effects of Distance to Large-scale Discount Store on Visit-frequency of Consumers

    Ji Nam seok | kyu hyun Ji | 2010, 20(2) | pp.193~209 | number of Cited : 12
    Abstract
    The purpose of this study is to analyze effects of distance on visit-frequency. To analyze this, this study implemented multiple regression analysis using location data of large-scale discount stores and household data of consumers. The result of the analysis in this study revealed that first, large-scale discount stores in Seoul metropolitan area prefer to locate near the subway station. Second, this study compared effects of distance on visit-frequency by regional groups. Results of the comparisons show that sensitivity of Seoul metropolitan area is greater than other regional groups. These differences can provide important implications for the planning distribution facilities. And, considering the connection between customer's visiting and sales of discount store, large-scale discount stores need to prepare some strategy to reduce customer's transportation costs when they select site location.
  • 11.

    Silver Housing Market and Reverse Mortgage

    유주연 | 이준용 | 한지원 and 1other persons | 2010, 20(2) | pp.211~232 | number of Cited : 4
    Abstract
    Reverse Mortgage was introduced in Korea as a social welfare policy for the elderly which provides stable income flow drawing from housing equity. Until recently, the reverse mortgage accepted only regular houses as collateral, excluding silver housing units built under the Elderly Welfare Act. The government has recently amended regulations governing the reverse mortgage to cover the silver houses. The purpose of this study is to provide basic data which are necessary in designing reverse mortgage products with the siver houses as collateral. We conducted extensive survey to identify characteristics of the silver houses and it market. Our study shows that expected rate of price increase should be set lower than regular houses in calculating monthly payment for the silver houses.