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The economic role of valuers in real property markets

[working paper]

Bartke, Stephan; Schwarze, Reimund

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Further Details
Corporate Editor Helmholtz-Zentrum für Umweltforschung - UFZ
Abstract Globally, real estate trade is highly regularized. Usually, the market value is not negotiated simply between the seller and potential buyer but based on an assessment performed by a professional valuer, known as a surveyor or appraiser. This paper inquires about the economic role of valuers in real estate markets. An institutionally embedded framework for valuation intermediation is developed that elucidates a multi-tiered imperfect information cascade. First, the valuer is understood as middleman counteracting information uncertainties on product quality of real estate. An additional constraint is constituted by information asymmetries between valuer and contractor. Drawing on New Institutional Economics, we discuss how the valuation professional with regularizations evolves globally as the superior institutional response to this cascade of information imperfections. A case of empirical evidence is provided for this concept of the regularized valuer.
Keywords real estate; market; evaluation; information capture; information economics; right of ownership; economic value; transaction costs; principal-agent-theory; expert; land use; accumulated toxic waste; risk assessment; land value; Brandenburg; Federal Republic of Germany
Classification Economic Sectors
Free Keywords asymmetric information; information and product quality; real estate services
Document language English
Publication Year 2015
City Leipzig
Page/Pages 42 p.
Series UFZ Discussion Papers, 13/2015
ISSN 1436-140X
Status Published Version
Licence Creative Commons - Attribution-NonCommercial-ShareAlike