Bouman, J.A. (Joost) (2020) The best-offer-over pricing method: a best-strategy? A case study in the Rotterdam housing marke. Master thesis.
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Abstract
As the best-offer-over method has been used increasingly in recent years, this suggests that the method is possibly rising to become the optimal sales strategy for house sellers. This study considers the situation in Rotterdam, where the use of the best-offer-over method has risen to 7.2 percent of all transactions in 2019, from only one application in 2008. Many argue that the best-offer-over method has a positive effect on transaction prices. To examine this, the present study focuses on the effect of the best-offer-over method on transaction prices in Rotterdam. This is done using a hedonic regression analysis of 50,605 transactions over 2008-2019. Due to the attractive force of relatively low list prices, which possibly draws in more potential bidders, it is expected that best-offer-over houses have higher transaction prices than houses that sell using the regular sales approach. Instead, initial findings indicate that, relative to regular home sales, the best-offer-over method has a significant -5.3 effect on transaction prices. In popular neighborhoods the effect is the most negative, and vice versa. There is also evidence that the effect is less negative for multifamily houses than for single-family houses. As this could possibly be explained through a relatively low quality of the houses sold using the best-offer-over method, this study importantly considers two new measures of the internal finishing quality of houses (n = 643). After controlling for internal quality, no significant effect of the best-offer-over method on transaction prices remains.
| Item Type: | Thesis (Master) |
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| Degree programme: | Real Estate Studies |
| Supervisor: | Daams, M.N. |
| Date Deposited: | 02 Sep 2020 07:09 |
| Last Modified: | 02 Sep 2020 07:09 |
| URI: | https://frw.studenttheses.ub.rug.nl/id/eprint/3351 |
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