{"id":265275,"date":"2024-05-09T02:38:09","date_gmt":"2024-05-09T00:38:09","guid":{"rendered":"https:\/\/www.wifo.ac.at\/publication\/265275\/"},"modified":"2024-05-15T12:50:35","modified_gmt":"2024-05-15T10:50:35","slug":"bargain-or-bust","status":"publish","type":"publication","link":"https:\/\/www.wifo.ac.at\/en\/publication\/265275\/","title":{"rendered":"Bargain or Bust?"},"content":{"rendered":"","protected":false},"featured_media":0,"template":"","class_list":["post-265275","publication","type-publication","status-publish","hentry"],"acf":{"subtitle":"Prices, Discounts, and Returns in the Market for Real Estate Foreclosures","text":"We examine foreclosure discounts and their subsequent impact on investor returns in Berlin's housing market from 1984 to 2022. Utilizing hedonic regression models and matching techniques on a data set of housing transactions, we determine that foreclosure discounts, ranging from 20 to 50 percent, are significant and persist over time. In a repeat sales approach, in which we explicitly account for the sequence of transactions, we show that initial investments in foreclosed properties yield average annualised returns surpassing matched non-distressed counterparts by 20.5 percentage points. However, when a foreclosure follows a regular sale, the average annualised returns are 9.6 percentage points lower than in matched non-distressed transaction pairs. Novel to the literature, we further show that this markdown is only associated with the foreclosure transaction, rather than putting a permanent stigma on the foreclosed apartment. Our ability to control for both observed and unobserved property characteristics suggests that this discount may be attributed to both a foreclosure stigma and the format used for foreclosure auctions in Germany. Consequently, our paper not only advances the foreclosure literature with new insights from a global city but also contributes to the discourse on auctions in a real estate context.","onlinedate":"2024-05-13 12:00:00","lang":"English","publication_series":"","publication_date":"20240508","publication_date_year":"","publication_date_full":true,"publication_num_pages":"53","keywords":"[\"Foreclosure Discounts\",\"Real Estate Investments\",\"Housing Market Dynamics\"]","jelcodes":"[\"R31\",\"G12\",\"D44\"]","related_publications":"[]","pdf":265608,"zip":null,"link":"","monthly_report":false,"monthly_report_main":false,"monthly_report_volume":"","monthly_report_pages":"","monthly_report_pages_sort":"0","issue":"675","journal":"WIFO Working Papers","publisher":"","invisible":false,"external":false,"embargo_date":"2024-05-13 12:00:00","types":[44410],"research_groups":[3481],"collaboration":"","persons":[5015,265188],"persons_data":"[{\"personId\":5015,\"personName\":\"Alexander Daminger\",\"organisationNames\":[]},{\"personId\":265188,\"personName\":\"Simon Wiersma\",\"organisationNames\":[]}]","clients":[],"subclients":[],"partners":[],"topics":[],"host_publication_title":"","host_publication_subtitle":"","place_of_publication":"","host_publication_editors":"[]","type_description":"","output_media":"","chapter":"","article_number":"","scientific_assistance":"[]","scientific_review":"[]","version":"","release_date":null,"expiration_date":null,"surveyor":"","research_assistance":"","edv":"","additional_info_de":"","additional_info_en":""},"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v27.3 (Yoast SEO v27.3) - https:\/\/yoast.com\/product\/yoast-seo-premium-wordpress\/ -->\n<title>Bargain or Bust? - WIFO<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.wifo.ac.at\/en\/publication\/265275\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Bargain or Bust?\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.wifo.ac.at\/en\/publication\/265275\/\" \/>\n<meta property=\"og:site_name\" content=\"WIFO\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/WIFOat\/\" \/>\n<meta property=\"article:modified_time\" content=\"2024-05-15T10:50:35+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/www.wifo.ac.at\/wp-content\/uploads\/2024\/05\/WIFO-Gebaeude-FotoAlexanderMueller-www.alexandermueller.at-IMG_6326-Bearbeitet-1.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"1920\" \/>\n\t<meta property=\"og:image:height\" content=\"1280\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:site\" content=\"@WIFOat\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\\\/\\\/schema.org\",\"@graph\":[{\"@type\":\"WebPage\",\"@id\":\"https:\\\/\\\/www.wifo.ac.at\\\/en\\\/publication\\\/265275\\\/\",\"url\":\"https:\\\/\\\/www.wifo.ac.at\\\/en\\\/publication\\\/265275\\\/\",\"name\":\"Bargain or Bust? - WIFO\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/www.wifo.ac.at\\\/en\\\/#website\"},\"datePublished\":\"2024-05-09T00:38:09+00:00\",\"dateModified\":\"2024-05-15T10:50:35+00:00\",\"breadcrumb\":{\"@id\":\"https:\\\/\\\/www.wifo.ac.at\\\/en\\\/publication\\\/265275\\\/#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\\\/\\\/www.wifo.ac.at\\\/en\\\/publication\\\/265275\\\/\"]}]},{\"@type\":\"BreadcrumbList\",\"@id\":\"https:\\\/\\\/www.wifo.ac.at\\\/en\\\/publication\\\/265275\\\/#breadcrumb\",\"itemListElement\":[{\"@type\":\"ListItem\",\"position\":1,\"name\":\"Startseite\",\"item\":\"https:\\\/\\\/www.wifo.ac.at\\\/en\\\/\"},{\"@type\":\"ListItem\",\"position\":2,\"name\":\"Bargain or Bust?\"}]},{\"@type\":\"WebSite\",\"@id\":\"https:\\\/\\\/www.wifo.ac.at\\\/en\\\/#website\",\"url\":\"https:\\\/\\\/www.wifo.ac.at\\\/en\\\/\",\"name\":\"\u00d6sterreichisches Institut f\u00fcr Wirtschaftsforschung\",\"description\":\"\",\"publisher\":{\"@id\":\"https:\\\/\\\/www.wifo.ac.at\\\/en\\\/#organization\"},\"alternateName\":\"WIFO\",\"potentialAction\":[{\"@type\":\"SearchAction\",\"target\":{\"@type\":\"EntryPoint\",\"urlTemplate\":\"https:\\\/\\\/www.wifo.ac.at\\\/en\\\/?s={search_term_string}\"},\"query-input\":{\"@type\":\"PropertyValueSpecification\",\"valueRequired\":true,\"valueName\":\"search_term_string\"}}],\"inLanguage\":\"en-US\"},{\"@type\":\"Organization\",\"@id\":\"https:\\\/\\\/www.wifo.ac.at\\\/en\\\/#organization\",\"name\":\"\u00d6sterreichisches Institut f\u00fcr Wirtschaftsforschung\",\"alternateName\":\"WIFO\",\"url\":\"https:\\\/\\\/www.wifo.ac.at\\\/en\\\/\",\"logo\":{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\\\/\\\/www.wifo.ac.at\\\/en\\\/#\\\/schema\\\/logo\\\/image\\\/\",\"url\":\"https:\\\/\\\/www.wifo.ac.at\\\/wp-content\\\/uploads\\\/2024\\\/05\\\/WIFO_kurz_rechts-2-1920x412.jpg\",\"contentUrl\":\"https:\\\/\\\/www.wifo.ac.at\\\/wp-content\\\/uploads\\\/2024\\\/05\\\/WIFO_kurz_rechts-2-1920x412.jpg\",\"width\":2000,\"height\":429,\"caption\":\"\u00d6sterreichisches Institut f\u00fcr Wirtschaftsforschung\"},\"image\":{\"@id\":\"https:\\\/\\\/www.wifo.ac.at\\\/en\\\/#\\\/schema\\\/logo\\\/image\\\/\"},\"sameAs\":[\"https:\\\/\\\/www.facebook.com\\\/WIFOat\\\/\",\"https:\\\/\\\/x.com\\\/WIFOat\",\"https:\\\/\\\/linkedin.com\\\/company\\\/wifoat\\\/\",\"https:\\\/\\\/www.youtube.com\\\/@WIFO_at\"],\"description\":\"Das WIFO, 1927 von Friedrich August von Hayek und Ludwig von Mises zur Konjunkturanalyse gegr\u00fcndet, ist heute das f\u00fchrende Institut f\u00fcr angewandte empirische Wirtschaftsforschung in \u00d6sterreich mit starkem Engagement auf europ\u00e4ischer Ebene.\",\"email\":\"office@wifo.ac.at\",\"telephone\":\"+43 1 798 26 01 \u2013 0\",\"legalName\":\"\u00d6sterreichisches Institut f\u00fcr Wirtschaftsforschung\",\"foundingDate\":\"1927-01-02\",\"numberOfEmployees\":{\"@type\":\"QuantitativeValue\",\"minValue\":\"51\",\"maxValue\":\"200\"},\"publishingPrinciples\":\"https:\\\/\\\/www.wifo.ac.at\\\/institut\\\/mission-und-strategie\\\/\",\"ownershipFundingInfo\":\"https:\\\/\\\/www.wifo.ac.at\\\/institut\\\/organisation\\\/\",\"actionableFeedbackPolicy\":\"https:\\\/\\\/www.wifo.ac.at\\\/aktuelles\\\/presse\\\/\",\"correctionsPolicy\":\"https:\\\/\\\/www.wifo.ac.at\\\/institut\\\/kontakt\\\/\",\"ethicsPolicy\":\"https:\\\/\\\/www.wifo.ac.at\\\/institut\\\/evidenzbasierung-transparenz-und-unabhaengigkeit\\\/\",\"diversityPolicy\":\"https:\\\/\\\/www.wifo.ac.at\\\/institut\\\/gleichstellung\\\/\",\"diversityStaffingReport\":\"https:\\\/\\\/www.wifo.ac.at\\\/institut\\\/gleichstellung\\\/\"}]}<\/script>\n<!-- \/ Yoast SEO Premium plugin. -->","yoast_head_json":{"title":"Bargain or Bust? - WIFO","robots":{"index":"index","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"canonical":"https:\/\/www.wifo.ac.at\/en\/publication\/265275\/","og_locale":"en_US","og_type":"article","og_title":"Bargain or Bust?","og_url":"https:\/\/www.wifo.ac.at\/en\/publication\/265275\/","og_site_name":"WIFO","article_publisher":"https:\/\/www.facebook.com\/WIFOat\/","article_modified_time":"2024-05-15T10:50:35+00:00","og_image":[{"width":1920,"height":1280,"url":"https:\/\/www.wifo.ac.at\/wp-content\/uploads\/2024\/05\/WIFO-Gebaeude-FotoAlexanderMueller-www.alexandermueller.at-IMG_6326-Bearbeitet-1.jpg","type":"image\/jpeg"}],"twitter_card":"summary_large_image","twitter_site":"@WIFOat","schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"WebPage","@id":"https:\/\/www.wifo.ac.at\/en\/publication\/265275\/","url":"https:\/\/www.wifo.ac.at\/en\/publication\/265275\/","name":"Bargain or Bust? - WIFO","isPartOf":{"@id":"https:\/\/www.wifo.ac.at\/en\/#website"},"datePublished":"2024-05-09T00:38:09+00:00","dateModified":"2024-05-15T10:50:35+00:00","breadcrumb":{"@id":"https:\/\/www.wifo.ac.at\/en\/publication\/265275\/#breadcrumb"},"inLanguage":"en-US","potentialAction":[{"@type":"ReadAction","target":["https:\/\/www.wifo.ac.at\/en\/publication\/265275\/"]}]},{"@type":"BreadcrumbList","@id":"https:\/\/www.wifo.ac.at\/en\/publication\/265275\/#breadcrumb","itemListElement":[{"@type":"ListItem","position":1,"name":"Startseite","item":"https:\/\/www.wifo.ac.at\/en\/"},{"@type":"ListItem","position":2,"name":"Bargain or Bust?"}]},{"@type":"WebSite","@id":"https:\/\/www.wifo.ac.at\/en\/#website","url":"https:\/\/www.wifo.ac.at\/en\/","name":"\u00d6sterreichisches Institut f\u00fcr Wirtschaftsforschung","description":"","publisher":{"@id":"https:\/\/www.wifo.ac.at\/en\/#organization"},"alternateName":"WIFO","potentialAction":[{"@type":"SearchAction","target":{"@type":"EntryPoint","urlTemplate":"https:\/\/www.wifo.ac.at\/en\/?s={search_term_string}"},"query-input":{"@type":"PropertyValueSpecification","valueRequired":true,"valueName":"search_term_string"}}],"inLanguage":"en-US"},{"@type":"Organization","@id":"https:\/\/www.wifo.ac.at\/en\/#organization","name":"\u00d6sterreichisches Institut f\u00fcr Wirtschaftsforschung","alternateName":"WIFO","url":"https:\/\/www.wifo.ac.at\/en\/","logo":{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/www.wifo.ac.at\/en\/#\/schema\/logo\/image\/","url":"https:\/\/www.wifo.ac.at\/wp-content\/uploads\/2024\/05\/WIFO_kurz_rechts-2-1920x412.jpg","contentUrl":"https:\/\/www.wifo.ac.at\/wp-content\/uploads\/2024\/05\/WIFO_kurz_rechts-2-1920x412.jpg","width":2000,"height":429,"caption":"\u00d6sterreichisches Institut f\u00fcr Wirtschaftsforschung"},"image":{"@id":"https:\/\/www.wifo.ac.at\/en\/#\/schema\/logo\/image\/"},"sameAs":["https:\/\/www.facebook.com\/WIFOat\/","https:\/\/x.com\/WIFOat","https:\/\/linkedin.com\/company\/wifoat\/","https:\/\/www.youtube.com\/@WIFO_at"],"description":"Das WIFO, 1927 von Friedrich August von Hayek und Ludwig von Mises zur Konjunkturanalyse gegr\u00fcndet, ist heute das f\u00fchrende Institut f\u00fcr angewandte empirische Wirtschaftsforschung in \u00d6sterreich mit starkem Engagement auf europ\u00e4ischer Ebene.","email":"office@wifo.ac.at","telephone":"+43 1 798 26 01 \u2013 0","legalName":"\u00d6sterreichisches Institut f\u00fcr Wirtschaftsforschung","foundingDate":"1927-01-02","numberOfEmployees":{"@type":"QuantitativeValue","minValue":"51","maxValue":"200"},"publishingPrinciples":"https:\/\/www.wifo.ac.at\/institut\/mission-und-strategie\/","ownershipFundingInfo":"https:\/\/www.wifo.ac.at\/institut\/organisation\/","actionableFeedbackPolicy":"https:\/\/www.wifo.ac.at\/aktuelles\/presse\/","correctionsPolicy":"https:\/\/www.wifo.ac.at\/institut\/kontakt\/","ethicsPolicy":"https:\/\/www.wifo.ac.at\/institut\/evidenzbasierung-transparenz-und-unabhaengigkeit\/","diversityPolicy":"https:\/\/www.wifo.ac.at\/institut\/gleichstellung\/","diversityStaffingReport":"https:\/\/www.wifo.ac.at\/institut\/gleichstellung\/"}]}},"_links":{"self":[{"href":"https:\/\/www.wifo.ac.at\/en\/wp-json\/wp\/v2\/publication\/265275","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.wifo.ac.at\/en\/wp-json\/wp\/v2\/publication"}],"about":[{"href":"https:\/\/www.wifo.ac.at\/en\/wp-json\/wp\/v2\/types\/publication"}],"version-history":[{"count":0,"href":"https:\/\/www.wifo.ac.at\/en\/wp-json\/wp\/v2\/publication\/265275\/revisions"}],"acf:post":[{"embeddable":true,"href":"https:\/\/www.wifo.ac.at\/en\/wp-json\/wp\/v2\/external_person\/265188"},{"embeddable":true,"href":"https:\/\/www.wifo.ac.at\/en\/wp-json\/wp\/v2\/person\/5015"},{"embeddable":true,"href":"https:\/\/www.wifo.ac.at\/en\/wp-json\/wp\/v2\/research_group\/3481"},{"embeddable":true,"href":"https:\/\/www.wifo.ac.at\/en\/wp-json\/wp\/v2\/publication_type\/44410"}],"wp:attachment":[{"href":"https:\/\/www.wifo.ac.at\/en\/wp-json\/wp\/v2\/media?parent=265275"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}