Ken H. Johnson

Florida Atlantic University | FAU

This note outlines the estimation methodology of the degree of over- or under-pricing for a given housing market relative to its long-term pricing trend. The purpose of this effort is to provide buyers, sellers, real estate professionals, and policy makers a tool that estimates the premium (over-pricing) or discount (under-pricing) a local market i...

This study makes two main contributions to the applied econometrics literature. First, it shows how the all-important marginal effects for time on the market and probability of sale can be obtained from any hazard model. Second, it extends the generalization of the geometric due to Gómez-Déniz, E. 2010. “Another Generalization of the Geometric Dist...

Miceli (1989), in a search for the optimal time to allow a broker to market property, posits that the principal (seller) may use the length of the listing contract to motivate the agent (listing broker) to better align incentives. Expanding slightly on Miceli, this work predicts that longer time allotted the broker to market residential property wi...

Existing academic literature on the relationship between agglomeration economies and university activities is both under-theorized and relatively sparse in terms of empirical examination. This paper addresses each of these voids by contributing and analyzing a market model of pro-revenue education program creation such as graduate-level executive b...

This paper investigates whether and to what extent the Beracha, Hardin, and Johnson Buy vs. Rent Index (BH&J Index) is able to anticipate future housing price movements. The BH&J Index is based on a model introduced by Beracha and Johnson (2012) in which a low index value is associated with a buy recommendation and a high index value is associated...

Despite a recent upturn, housing prices remain in flux in most cities nationwide. Lenders are still left dealing with a glut of distressed properties. They can choose to foreclose on the property or allow the owner/mortgagor to attempt to sell the property for less than the outstanding balance of the mortgage in a short sale agreement. The best way...

While it is well documented that homeowners have greater total wealth than renters, it is not clear that homeownership causes this wealth differential. We consider the buy versus rent decision in the framework of household portfolio choice. This allows us to determine whether owning a home increases the utility of households by improving the perfor...

It is well accepted that homeowners, on average, have greater total wealth than renters. However, Beracha and Johnson (2012) show that in a strict “horserace” comparison, renting creates higher wealth than ownership in the majority of cases. In this paper, we revisit Beracha and Johnson's buy versus rent model to investigate factors affecting the w...

This paper investigates price distortions in dual agent real estate transactions. Consistent with the literature, we find that dual agent has a null effect on sale price. However, dual agent distortions on sale price emerge after controlling for the ownership of the property. We find that dual agent is associated with a 6.35 percent price premium o...

The impact of incentives on marketing duration is examined for residential real estate using data from the Multiple Listing Service during a real estate downturn. The focus is on incentives offered directly by sellers to potential homebuyers. The evidence suggests that incentives are not capitalized into the selling price during the softened market...

The property price-marketing duration relationship is an important component of many real estate studies. However, contrary to theories, and widely-held notions of many researchers, the relationship is not as straightforward as generally assumed. In this paper, we summarize the literature and model price and marketing time to highlight the nature o...

In the past few years, many states have responded to the increasing number of limited service brokers by passing minimum service requirements. Limited service brokers can be viewed as those brokers who are offering their marketing and representative services A La Carte as opposed to the more traditional full-services brokers offering of a Table D’h...

This work empirically investigates the effect of the amount of time provided the broker to market property (listing contract length) on the likelihood of a successful marketing attempt. Do shorter listing contracts increase broker motivation or can contracts be so short that marketing efforts are unlikely to result in a successful transaction? The...

This paper investigates the relationship of property price and time-on-market to the use of property photo depictions in a multiple listing service. Empirical testing reveals that price as a function of photo depictions is increasing at a decreasing rate for both interior and exterior photos. Testing also reveals that time-on-market as a function o...

Home ownership is touted as the "American Dream". It is credited with enhancing wealth, increasing civic pride, improving self-esteem, crime prevention, child development, and better educational outcomes, among other benefits. This paper does not dispute any of these claims. Instead, this study hypothesizes that crowding toward homeownership raises...

This paper considers the relationship between energy-efficient design and the leasing/sales markets for commercial real estate. An economic model is provided that considers lease rates and occupancy in simultaneous equilibrium. The behavior of both is predicted to be influenced by efficient design attributes. Selling price is determined by both ren...

This work empirically investigates the effect of the amount of time provided the broker to market property (listing contract length) on the likelihood of a successful marketing attempt. Do shorter listing contracts increase broker motivation or can contracts be so short that marketing efforts are unlikely to result in a successful transaction? Empi...

This work investigates the effect of uncertainty over a property's flood zone status and the probability of a transaction for residential property during a given marketing period. While the impact on property price from flood zone delineation is well documented, the effect of any uncertainty over the location of property with respect to the 100-yea...

This study is one of the first to investigate brokerage intermediation effects in the income producing commercial property market. Employing multifamily sales data from the Atlanta and Phoenix markets under alternative brokerage specifications, little evidence to support the existence of systematic, differential transaction pricing outcomes due to...

Miceli (1989) in a search for the optimal time to allow a broker to market property provides a theoretical model which posits that the principal (seller) may use the length of the listing contract to motivate the agent (listing broker) to better align incentives. Expanding slightly on Miceli, this present work predicts that longer time allotted the...

This paper investigates the impact of privately-administered architectural review boards on property price and marketing time and, thus, their financial efficacy. Additionally, the paper demonstrates the usefulness of two-stage least squares regression as a modeling technique to better capture the simultaneous determination of property price and pr...

This research seeks to determine what factors are decisive when an agent chooses between a 100% payout and the more traditional split-commission arrangement. In addition to the expected positive relationship between income and the 100% payout election, a tolerance for risk, a complementary sales force, and experience also influence the choice of co...

Using an effective sample of 3,453 observations selected from the Taiwanese stock exchange, this study documents and attempts to reconcile divergent outcomes from the extant literature on debt structure (public, bank, and non-bank private debt). Sampled firms from this emerging market generally acquire debt from both public and private sources, wit...

This paper seeks to empirically determine whether more skilled and productive real estate salespeople, identified as full-payout or 100% commission agents, have a discernable, systematic effect on property selling price and its marketing time. Two types of agents, 100%ers and split-commission agents are identified and controlled for in hedonic pric...

This paper investigates the relationship between property pricing precision (deviation from an expected property value) and specialization in the listing process by agents. It is hypothesized that financially constrained, risk-averse sellers prefer finer gradations of pricing precision, i.e., less deviation from expected property value, and that a...

Executive Summary. This study documents the rela- tionship between commercial property price and its mar- keting time. Findings indicate that extended marketing times induce lower transaction prices and that higher priced properties sell in relatively shorter marketing spans. These results are suggestive of a ''shopworn'' pric- ing effect and the e...

Executive Summary. A framework is established in which an investor (the real estate broker) must form a portfolio of two assets (two types of agents), each repre- sented by their returns to the broker. The very risky asset (corresponding to the agent type that has negotiated a split commission contract with the broker) is shown in contrast to the l...

Earlier research has found that specialization by real estate agents creates economies of scope for real estate firms. So far, however, no research has addressed this issue at the agent level. The question this research seeks to answer is whether specialization in one side of the real estate transaction increases agent income. The most important fi...

Academics participating in the residential real estate literature have recently begun to focus on the design of list prices, as opposed to the magnitude of list prices. The specialized design of list prices, referred to as ''charm,'' ''even,'' and ''just-below-even'' pricing is the subject of three recent works. This paper provides an alternative t...

This work investigates the determinants of the probability of sale during a given marketing span for residential properties. The inconsistent empirical relationship between property price and property selling time in numerous prior studies suggests an investigation into the determinants of a successful marketing effort is warranted. Results indicat...

This study investigates whether or not non-traditional marketing has an effect on the prices paid for residential real estate. Non-traditionally broker-marketed properties are defined as those properties that are sold with the aid of a real estate broker, but not marketed through a Multiple Listing Service (MLS). An analysis of properties that sold...

This paper investigates the impact on both sales price and marketing time of offering a bonus to the selling broker of property. Recognizing and controlling for the different incentives inherent in pricing versus exposure listing strategies, this article employs hedonic pricing and time-on-market (TOM) estimations to uncover the relationship among...

This paper examines the factors that influence the use of the Internet as part of the home buying process and the resulting effect on the efficacy of buyer search. Cross section data acquired from NAR’s 2000 Home Buying and Selling Survey is used to conduct the analysis. This study finds that the use of the Internet as a search tool does not reduce...

This paper investigates for the impact on property price and marketing time of offering a bonus to the selling broker. Intuitively, the broker's opportunity for increased compensation should increase the price received by the seller, decrease the property's marketing time, or both. Recognizing and controlling for the different incentives inherent i...

This article is the winner of the Real Estate and the Internet manuscript prize (sponsored by PricewaterhouseCoopers) presented at the American Real Estate Society Annual Meeting. Brokers have long believed that difficult to show properties sell at lower prices and take longer to sell. Where difficult to show properties are defined as those propert...

Recently the use of artificial stucco (formally known as Exterior Insulation and Finish Systems, or EIFS) on residential real estate properties has been a topic of much debate. In this paper, we outline the issues surrounding EIFS use. Subsequently, we develop and test hypotheses regarding the impact of EIFS on property value and marketing time. Th...

Using a hedonic pricing model, we analyze the capitalization of total seller paid discount points and closing costs into the price of a house. We hypothesize that sellers are concerned about the sales price net of total seller paid concessions (SPNC), rather than the exact terms of the transaction. Since the SPNC is easily ascertained in the negoti...

Earlier research has found that specialization by real estate agents creates economies of scope for real estate firms. So far, however, no research has addressed this issue at the agent level. The question this research seeks to answer is whether specialization in one side of the real estate transaction increases agent income. The most important fi...