Transaction costs of commercial real estate: a european comparison

1. Transaction costs of commercial real estate: a european comparison Ed Nozeman ERES 2010

2. Content Introduction Definition and typology The hypothesis Methodology Results Recommendations Transaction costs

3. Introduction Importance Sources or causes Preliminary questions Transaction costs

4. Definition All expenses involved in the process of transferring ownership rights Typology (Geltner a.o.) Transfer tax Agents’ fees Legal fees Information costs Investors’ perspective Transaction costs

5. The basic assumption The higher the level of transparency the lower the transaction costs Transaction costs

6. Methodology Only transfer tax, agents’ fees and legalfees Relativeratios Oneyear data from C & W Adaptationsbecause of variations Transparency data from JLL Crossingsbyregressionanalysistechnique Transaction costs

7. Transaction costs

8. Results : Transparency vs transfer tax Transaction costs Number of observations 22 Multiple R 0,297827607 F-test 1,849365

9. Results Transparency vs agents’ fee Transaction costs Number of observations 22 Multiple R: 0,430172275 F-test: 0,045682503

10. Results Transparency vs legal fee Transaction costs lNumber of observations 14; Multiple R 0,268143; Number of observations 14; Multiple R 0,268143 F-test: 0,375741389

11. Recommendations for further research Background of tax policy per country Influencing power of lobby groups Registration fee and extent of efficiency Transaction costs