The Stigma Effect on Property Value: A Study of 'Value Depreciation' and its Distribution in India

NICMAR Journal of Construction Management and Research, Volume XXXII, No. 2. pp 42-52, (October – December 2017

14 Pages Posted: 18 Oct 2018

See all articles by Ramakrishna Nallathiga

Ramakrishna Nallathiga

NICMAR; Center for Good Governance

Snehil Bindal

National Institute of Construction Management and Research, Students

Ajay Chaurasia

National Institute of Construction Management and Research, Students

Mayur Talodhikar

National Institute of Construction Management and Research, Students

Date Written: December 4, 2017

Abstract

Valuation of real properties is an important process that aids the real estate/property market transactions and agents. Valuation of properties is generally governed by physical, economic and financial factors concerning the property, market conditions and market players. However, other factors like information, belief, trust and other psychological and behavioural factors also affect the value of property to a good extent, but this aspect is not studied much. ‘Stigma’ associated with the property is one such psycho-behavioural factor attached to property that affects its value. Varieties of ‘stigma’ can exist upon a property depending upon the situation. This paper reports an assessment of the effect of ‘stigma’ on property value in terms of ‘depreciation’ on the value of comparable properties. Based on the primary data collected from various parts of the country (all observations from Indian cities), the paper analyses the distribution of the ‘stigma effect on property value depreciation’ across various regions of India i.e., north, south, east west and central. Subsequently, the paper also analyses on which aspect of the property value can the stigma impact can be seen most i.e., income yield (Y) or capital value (C). The distribution of ‘stigma effect’ across the regions is thus explained through the Y-C matrix derived for the above regions.

Keywords: Real Properties, Property Value, Stigma, Valuation, Y-C Matrix

Suggested Citation

Nallathiga, Ramakrishna and Bindal, Snehil and Chaurasia, Ajay and Talodhikar, Mayur, The Stigma Effect on Property Value: A Study of 'Value Depreciation' and its Distribution in India (December 4, 2017). NICMAR Journal of Construction Management and Research, Volume XXXII, No. 2. pp 42-52, (October – December 2017. Available at SSRN: https://ssrn.com/abstract=3215758

Ramakrishna Nallathiga (Contact Author)

NICMAR ( email )

NICMAR, 25/1, NIA Post Office, Balewadi
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91-20-66859146 (Phone)

HOME PAGE: http://www.nicmar.ac.in

Center for Good Governance ( email )

Dr MCR HRD Campus, Road No. 25, Jubilee Hills
Hyderabad, Andhra Pradesh 500033
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HOME PAGE: http://www.cgg.gov.in

Snehil Bindal

National Institute of Construction Management and Research, Students

Pune
India

Ajay Chaurasia

National Institute of Construction Management and Research, Students

Pune
India

Mayur Talodhikar

National Institute of Construction Management and Research, Students

Pune
India

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