Undivided Real Estate Shares: Appraisal and Interactions with Capital Markets

Abstract:

The appraisal of undivided and indivisible real estate shares represents a recurring and underestimated issue by professional appraisers. This problem requires a logical solution considering that the undivided real estate shares are more difficult to sell and, consequently, there is a decrease of their market value. It follows that issue can be referred, in theoretical and practical terms, to the real estate investment risk valuation and on how to convert this risk into an expected rate that can compensate it. In this paper the Capital Asset Pricing Model has been integrated with Penalized Spline Semiparametric Method in order to obtain an algorithm that allows to rationalize the appraisal of undivided real estate shares using easily accessible data.

• Periodical: Applied Mechanics and Materials (Volumes 584-586)
• Pages: 2522-2527
• DOI: https://doi.org/10.4028/www.scientific.net/AMM.584-586.2522
• Online since: July 2014
• Authors: Vincenzo del Giudice, Pierfrancesco de Paola*
• Keywords: Capital Asset Pricing Model, Penalized Spline Semiparametric Method, Real Estate Investments, Undivided Real Estate Shares

References

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