Abstract

http://ssrn.com/abstract=1702984
 
 

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Aspects Regarding the Interdependence between Capital Market and Real Estate Market


Mirela Matei


affiliation not provided to SSRN

Ioan Done


affiliation not provided to SSRN

Jean Andrei


Petroleum and Gas University of Ploiesti

November 7, 2008

International Conference Science and Technology in the Context of Sustainable Development Organized on the Occasion of the 60th Anniversary of Petroleum , Gas University of Ploieşti, 2008

Abstract:     
Real estate field is in a steady development in Romania, like in others countries from Central and Eastern Europe. The determinant facts are development of banking sector and capital market, setting up of specialized actors, the interest of foreign investors, the increase in purchase power of the population. The banks` offer has had diversified and "exotic" currencies are now available for mortgage credits. An impulse for the development of mortgage credits is the establishment of legal framework: the law of mortgage bonds and the law of mortgage banks. Romanian real estate companies are in a start-up stage, but there are many development possibilities. In this order, we can use the experience of others countries from America and Europe. The innovative process in capital markets offers many instruments for speculation and hedging strategies. For example, in USA and West Europe, the main stock and commodities exchanges have launched futures and options contracts on real estate indexes like CREX or Standard&Poor`s/Case Schiller. Now, Romanian investors have few opportunities, but the development of real estate products will offer many possibilities. In this order, public and private initiative will contribute to the development of real estate market in Romania, like in others countries from Central and Eastern Europe. For example, in Bulgaria, real estate investment trusts (REITs) are set up in 2003 and they use the funds to make investments only in real estate fields. The major part of their profits (around 90%) are used to paid dividends to shareholders. So, the shares of REITs are instruments to invest in real estate fields without purchasing properties. For this reason, institutional and even individual investors use these instruments.

Number of Pages in PDF File: 8

Keywords: real estate, exchanges, REITs, securitization

JEL Classification: C44, D81

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Date posted: November 7, 2010 ; Last revised: November 8, 2010

Suggested Citation

Matei, Mirela and Done, Ioan and Andrei, Jean, Aspects Regarding the Interdependence between Capital Market and Real Estate Market (November 7, 2008). International Conference Science and Technology in the Context of Sustainable Development Organized on the Occasion of the 60th Anniversary of Petroleum , Gas University of Ploieşti, 2008. Available at SSRN: http://ssrn.com/abstract=1702984

Contact Information

Mirela Matei
affiliation not provided to SSRN ( email )
Ioan Done (Contact Author)
affiliation not provided to SSRN ( email )
Jean Andrei
Petroleum and Gas University of Ploiesti ( email )
B-dul Bucuresti, No. 39
Ploiesti
Romania
HOME PAGE: http://www.upg-ploiesti.ro/
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