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The Role of Listing Price Strategies on the Probability of Selling a House: Evidence from Vietnam

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  • Bich Hong Nguyen Thi

    (Faculty of Economics, University of EconomicsHo Chi Minh City)

  • Trong Hoai Nguyen

    (Faculty of Economics, University of EconomicsHo Chi Minh City)

  • Thanh Hiep Truong

    (Faculty of Economics, University of EconomicsHo Chi Minh City)

Abstract

The aim of this paper is to measure the dynamic effects of listing price strategies and housing features on the probability of selling a house over the marketing period by adopting a two-stage regression analysis. In the first stage, we define the listing price strategies as the gaps between the actual listing price and expected selling price, estimated by a hedonic model. The Cox Probability Hazard models are applied in the second stage to measure the effects of listing price strategies on the probability of sales over various listing periods, such as 30-day, 90-day, 180-day and 270-day listing periods.We find that overpriced listing strategies have a significant impact on the probability of sale at any point during the first 30 days of marketing time. This effect seems to diminish and disappear after six months of marketing time. This shows that the first 30 days of the marketing time are critical and housing liquidity is strongly affected by pricing strategies. When the time on market is over 30 days, the influence of the seller’s pricing decisions on housing liquidity is diminished.

Suggested Citation

  • Bich Hong Nguyen Thi & Trong Hoai Nguyen & Thanh Hiep Truong, 2020. "The Role of Listing Price Strategies on the Probability of Selling a House: Evidence from Vietnam," Real Estate Management and Valuation, Sciendo, vol. 28(2), pages 63-75, June.
    • Handle: RePEc:vrs:remava:v:28:y:2020:i:2:p:63-75:n:6
    DOI: 10.1515/remav-2020-0016
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    More about this item

    Keywords

    Vietnam Housing Market; Listing Price Strategies; Probability of Sale; Cox Proportional Hazard Model;
    All these keywords.

    JEL classification:

    • C51 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Model Construction and Estimation
    • D01 - Microeconomics - - General - - - Microeconomic Behavior: Underlying Principles
    • R21 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Housing Demand

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