Risk and Return to Housing, Tenure Choice and the Value of Housing in an Asset Pricing Context

REAL ESTATE ECONOMICS, Vol. 24 No. 1

Posted: 3 Jul 1998

See all articles by Dennis Richard Meyer

Dennis Richard Meyer

University of South Florida - College of Business Administration

Kenneth Wieand

University of South Florida - College of Business Administration

Abstract

Homeowners do not diversify their risky home equity because of fixed costs of issuing securities and information costs. An asset pricing model is developed for homeowners with the undiversifiable home equity asset. Homeowner value and house value to diversified landlords are compared, and a tenure choice equation is developed. We demonstrate the existence of a rational expectations equilibrium under appropriate conditions.

JEL Classification: G12

Suggested Citation

Meyer, Dennis Richard and Wieand, Kenneth, Risk and Return to Housing, Tenure Choice and the Value of Housing in an Asset Pricing Context. REAL ESTATE ECONOMICS, Vol. 24 No. 1. Available at SSRN: https://ssrn.com/abstract=9029

Dennis Richard Meyer (Contact Author)

University of South Florida - College of Business Administration ( email )

4202 E. Fowler Avenue, BSN 3403
Dept. of Finance
Tampa, FL 33620-5500
United States
813-974-2081 (Phone)
813-974-3030 (Fax)

Kenneth Wieand

University of South Florida - College of Business Administration ( email )

4202 E. Fowler Avenue, BSN 3403
Center for Economic Development Research
Tampa, FL 33620-5500
United States

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