On the waterfront : a 25 year study of the relative risk & return of Florida single-family waterfront and inland homes (1977-2002)

This study applies the classic capital markets risk/return relationship-the riskier the investment, the greater the expected return-to the single-family home market. Treating coastal waterfront property as a unique asset class, its investment performance is measured and compared with that of inland property to determine the potential existence of a "mispricing" in the home market. Using single-family home transaction data from four coastal Florida counties, this thesis uses a repeat-sales regression technique to estimate annual home price changes and to construct home price indices for the period 1977-2002. The resulting price indices show a higher average annual appreciation rate for waterfront homes relative to inland homes; the highest waterfront price appreciation occurred over the period 1997-2002. The results also indicate that waterfront homes in two of the four study counties experienced higher average price appreciation at lower levels of risk than the inland homes. This finding indicates a potential "mispricing" of waterfront homes.

Department dc:contributor.department

Massachusetts Institute of Technology. Dept. of Architecture.

Grantor dc:publisher

Massachusetts Institute of Technology

Year dc:date.issued

2003

Author dc:creator

• Westin, Forrest A. (Forrest Alexander), 1977-

Advisor dc:contributor.advisor

• Henry O. Pollakowski.

• Architecture.

Statement dc:rights

• M.I.T. theses are protected by copyright. They may be viewed from this source for any purpose, but reproduction or distribution in any format is prohibited without written permission. See provided URL for inquiries about permission.

Licence dc:rights.uri

• http://dspace.mit.edu/handle/1721.1/7582

Language dc:language.iso

eng

Handle dc:identifier.uri

http://hdl.handle.net/1721.1/29779

OAI identifier oai:identifier

oai:dspace.mit.edu:1721.1/29779