The real estate market (in a broad sense) is a collection of
mechanisms ensuring the alienation of complete and partial rights property from one subject to another.
The real estate market (in the narrow sense) is a collection of objects
real estate for which it is possible to be involved in economic turnover.
The real estate market is imperfect due to the absence of a number of characteristic features inherent in a perfect market (Table 1).
The real estate market is an essential component of the national economy. Without a real estate market there cannot be a market at all, since the labor market, capital market, market for goods and services, and the like, in order to exist, must have or rent the appropriate premises necessary for their activities.
Demand in the real estate market is represented by buyers purchasing real estate for the purposes of investment, commercial operation (rent), use for organizing production or commercial activities (financial and economic purposes), or for direct use (accommodation), social purposes, providing opportunities for the creation of infrastructure facilities ( non-cost goals).
Table 1
Characteristics of the conventional market and the real estate market
End of table. 1
| 6. Nature of transactions | public and exchange | are of a private nature |
| 7. Reliability and completeness of information | very high | Available information is often unreliable |
| 8. Availability of information about products and the market | very high | access to information is usually difficult |
| 9. Speed of information exchange | very high | Low |
| 10. The degree of awareness of the buyer and seller about the product | high | Low |
| eleven . Legal regulation of the relationship between buyer and seller | minimum | Significant |
| 12. Price stability | prices are stable | upward trend in prices |
| 13. Transportability | high | Absent |
| 14. The influence of location on the price of goods | minor | very significant |
| 15. The role of nationality in decision making in the market | practically absent | prominent role |
| 16. Possibility of a relatively quick noticeable increase or decrease in supply volume | significant | Virtually absent due to the length of the construction cycle |
Features of the supply in the real estate market suggest its division into primary and secondary markets.
In the primary market, real estate appears as a product for the first time, and the main sellers are construction and investment construction companies.
The secondary market represents real estate that was previously used and belonged to a specific owner.
The situations in the secondary and primary markets are interconnected.
The following factors influence supply and demand in the real estate market:
1) economic;
2) social;
3) administrative;
4) environment;
5) political, national, cultural factors, traditions of the population.
Real estate market - sector of the national market economy, which is a set of real estate objects, economic entities operating in the market, market functioning processes, that is, processes of production (creation), consumption (use) and exchange of real estate objects and market management, and mechanisms ensuring the functioning of the market (infrastructure market).
In accordance with the above definition, the market structure includes:
Real estate objects are market subjects;
Market functioning processes, market mechanisms (infrastructure).
When describing the structure of the real estate market, the three most common approaches are used: institutional, object, and reproduction.
If we describe each type professional activity in the real estate market from the point of view of legal norms, rules and standards, typical ways of its implementation and regulation, that is, as an independent institution, and also indicate the relationships between institutions - we get institutional approach. Let's name some institutions of the real estate market:
Authorities (federal, regional, municipal) that regulate the conditions for the functioning and development of the real estate market;
Institute of Independent Real Estate Valuation;
Development;
Banks and other financial institutions ( investment funds, trust funds) that use the collateral lending mechanism in their activities;
Institute of Property Managers;
Institute of Realtors;
Public and private notaries;
Construction organizations; real estate tenants;
Real estate sellers;
Self-regulatory and social-professional associations of real estate market participants.
If we classify activities in the real estate market from the point of view of the object of civil legal relations (land, artificial structures, as well as the property rights corresponding to them), we implement “ object approach descriptions of the structure of the real estate market.
It would be fair to highlight:
Land market: primary (including privatization) and secondary markets, rental market (which is also divided into primary and secondary) and other forms of assigning plots of land for use;
The market of artificial structures: is divided into the market of residential and non-residential premises. The market for non-residential premises is divided into the market for commercial, industrial and social (parks, recreation areas, sanatoriums, cultural centers) real estate. Each of the sectors can be primary (including privatization) and secondary, and also include the rental market;
Construction market: markets construction contracts, projects, technologies, etc.;
The timeshare market (time periods into which the use of the same property is divided by different owners, for example: a year-round “schedule” for renting a villa on the seashore by five families).
"Reproductive" approach describes the structure of the market through the prism of relationships that arise in the process of the reproduction cycle of real estate. With a sufficient degree of convention, they can be represented by three groups of relations:
Relations arising in the process of reconstruction or creation of a real estate property (in the real estate market they constitute the real estate development sector);
Relations arising in the process of operation, maintenance and management of real estate (in the real estate market they constitute the consumption sector of real estate);
Finally, in a scattered form, figuratively speaking, “in the intervals” between the relationships regarding the creation and consumption of real estate, there are relations of redistribution of rights to real estate. In the real estate market, they constitute the sector of turnover of real estate rights.
Sector of development (reconstruction, creation) of real estate objects involves activities to create (modify) the physical characteristics of real estate objects. The latter determine the entire further nature of transactions with rights (turnover) and consumption of the property.
Real estate rights turnover sector ensures the transfer of rights to real estate, registration of rights and transactions with them. As a result of the turnover of rights, real estate is redistributed between economic entities in accordance with their economic purposes and interests. With the transfer of rights, property owners also have responsibilities, first of all, to pay taxes and maintain real estate at their own expense and under their own responsibility. Public responsibilities encourage efficient consumption (i.e., operation, management) of the beneficial properties of real estate.
Property Operations and Management Sector provides “consumption” - operation, maintenance and management of real estate. These relations arise from the moment of acquisition of rights to real estate and, as it were, close life cycle its existence. The organization of “consumption” of real estate determines the duration of the physical existence of the object and the beneficial effect for the owner: whether owning real estate will allow him to receive income or solve social problems. This lays the groundwork for the expansion of real estate either through the acquisition of new rights to real estate or through new construction.
The intertwining of relations between these sectors forms reproductive structure the real estate market as a whole.
The real estate market in the national economy performs the following functions:
Effective solution of social problems associated with the creation and use of useful properties of real estate;
Alienation of full or partial ownership rights to real estate from one economic entity to another and protection of his rights;
Free formation of prices for objects and services;
Redistribution investment flows between competing types of real estate;
Redistribution of investment flows between competing land use methods.
The importance of the real estate market as a sector of the market economy is confirmed by:
The colossal value of national wealth materialized in real estate, from which at least half can be involved in market turnover and bring rent to owners, income to entrepreneurs, tax and other payments to the federal, regional, and municipal budgets;
Achieved today high share real estate market in gross national product;
Achieved in a number of regions and cities a high level of budget income from the primary sale and rental of state and municipal real estate (including land);
A high level of collections into the budget from taxes on real estate and transactions with it, a large number of jobs created during the formation and development of the real estate market.
Features of the real estate market are determined by the nature of real estate.
Unlike financial market, market valuable papers or work force, the real estate market has a clearly defined regional specifics, because it is “tied” to a specific location of real estate.
The magnitude and nature of demand for real estate are predetermined by the political system of society, geographical, historical and cultural factors, the state of infrastructure and the availability of potential jobs, the level of economic development the region as a whole. Demand for real estate is not fungible(for example, demand for housing cannot be redirected to industrial facilities).
Almost all transactions in the real estate market require state registration.
The vast majority of citizens are the owners of a single type of real estate - housing. Therefore, the real estate market fulfills function of a social stabilizer. Thus, the transfer of ownership of the housing stock to citizens and the reasonable regulation of housing rights allowed Soviet Russia in 1924-1928. to form independent self-government, overcome the 30% devastation of the urban economy and raise the standard of living of the population to the levels of 1913. On the contrary, a violation of the social function of the real estate market leads to destabilization and collapse of the ruling regime, as happened in January-March 1997 in Albania.
The combination of all factors forms the special character of the local real estate market in each region.
Clarification. The regional connection of the real estate market has a number of important consequences.
1. The concept of “a single real estate market in Russia” should be taken with a significant degree of convention. For example, the “common (single) market” of Russian labor means not only a system of relations regarding the purchase and sale (hiring) of labor, but also the possibility of its free movement between regions. From the definition of real estate, it is obvious that it is impossible to “move” it. Consequently, the term “unified” in relation to the Russian real estate market can be deciphered as “a set of norms, rules and procedures for the movement of rights to real estate common to Russia, or as a single regulatory space.”
2. Therefore, the main task of the federal center is to formulate uniform norms, rules and procedures for the movement of rights to real estate that are mandatory for all participants in the real estate market, taking into account differences in the economic development of regions.
It is also necessary to change the content regional policy federal center: by stimulating the economic independence of the regions, based on the involvement of the property of the subjects of the Federation and municipalities in economic turnover, it must suppress attempts to introduce any local restrictions on legal rights or conditions for the economic turnover of real estate, if they are determined not by economic feasibility, but by the political preferences of regional authorities.
The material base of the market consisted of two sources. The first is free privatization of housing by citizens, free and paid privatization of non-residential premises and land plots(market for primary privatization of real estate). The second is the formation within the construction industry and outside of it of a segment of commercial construction and sale of objects (primary market for construction and sale of real estate). Subsequently, a secondary real estate market was formed - a market for the resale of previously privatized or new properties sold for the first time.
The structure and infrastructure of the real estate market, the system of concepts and terminology developed somewhat spontaneously. But at the same time, the experience of countries with developed countries was actively used market economy(primarily the USA, as well as Germany, Great Britain, France, Austria, etc.), which, when developing the legislative, regulatory, methodological framework of the market, was adapted to real conditions whenever possible transition economy Russia.
By functional purpose objects, the real estate market is divided into four main components:
Land market (land plots);
Housing Market;
Non-residential market;
Industrial real estate market.
Each of these segments develops independently, as it relies on its own legislative and regulatory framework and has significant differences in the policy of privatization of state and municipal property.
Additionally, we can highlight the market for unfinished construction projects, where special procedures apply for the assessment and sale of objects and the strong role of government regulation, since the state is the owner of the vast majority of frozen construction projects. Moreover, in this market it is possible to measure both the intended purpose of an unfinished object and the original development plan.
An intermediate position is occupied by the hotel services market, which is characterized by the provision of housing for temporary use for a period of one day or more and the presence of a developed infrastructure for servicing guests (public service enterprises, trade, transport and excursion services, business, sports and cultural services).
In each market segment, we can talk about the presence of two components: a primary one, which characterizes the appearance of real estate as a product on the market. The state, represented by federal, regional and local authorities, currently acts as the main seller of real estate; secondary, where a large number of sellers and buyers (individuals and legal entities) operate.
The transfer of rights to real estate is carried out, as a rule, according to one of the following options:
On a permanent basis, that is, acquisition of ownership or transfer for indefinite (paid or gratuitous) use;
On a temporary basis, that is, leasing or transferring for temporary use.
The owner of real estate not only owns and uses the property, but also disposes of it. He can sell it, exchange it, rent it out, pledge it, bequeath it, or transfer it free of charge at his discretion.
State and municipal enterprises do not have the right to lease real estate assigned to them with the right of full economic management. The lessor of this property is the State Committee of the Russian Federation for the Management of State Property represented by the relevant departments and territorial bodies.
For enterprises of other forms of ownership, restrictions on the disposal of real estate are established.
In particular, the standard charter joint stock company open type, used for corporatization state enterprises, determines that decisions on leasing, selling, exchanging, pledging or other alienation of real estate of a company exceeding in value 10% of assets (authorized capital) are made not by the board or director, but general meeting shareholders. There are a number of barriers to the further expansion of market relations in the real estate sector, due to transition period in the Russian economy.
Barriers of an economic nature include investment, credit and tax policy state, as well as problems arising from inflation, non-payments, increasing payback periods for investments and other factors.
Administrative barriers, which are established by executive authorities at all levels, play a significant role. This concerns such aspects as registration of enterprises, licensing of various types of activities in the real estate sector, the procedure for the provision, purchase and sale and rental of land plots, housing and non-residential premises, unfinished construction projects.
The scale and pace of development of the real estate market is greatly affected by the underdevelopment of market infrastructure.
Limitation land resources and problems related to security environment, complement the list of barriers that objectively prevent the entry of new entities into the real estate market.
The Russian real estate market reflects all the problems of a transition economy and is characterized by uneven development of its individual segments, imperfect legislative framework and low investment activity of citizens and legal entities. At the same time, this market represents a promising area for investing capital, intelligence and energy.
The prospects for the real estate market in the housing sector are ultimately determined by the existence of an objective need for the population to improve housing conditions. There is an acute housing shortage in Russia. This is evidenced by the data of the State Committee of the Russian Federation on Statistics and materials of the State target program"Dwelling" are given below:
Approximately 11 million families and individuals live in communal apartments, hostels, rent housing from private owners of houses and apartments;
More than 1 million people live in dilapidated and emergency houses;
17 million people have living space less than 5 m2 per person with a sanitary standard of 9 m2.
At the end of 1994, about 9 million Russians were on the waiting list for improved housing conditions, including those included in 12 preferential categories.
Improvement of living conditions is carried out through:
Providing municipal free housing for social use;
Home sales.
The housing fund for social use is primarily used to improve the living conditions of disabled people and participants of the Great Patriotic War. Patriotic War, single women who participated in the Great Patriotic War, former juvenile prisoners of concentration camps; waiting lists of preferential categories in accordance with current legislation - demobilized officers, people's judges, participants in the liquidation of the accident at Chernobyl nuclear power plant, rehabilitated, tuberculosis patients, etc.
All other citizens can improve their living conditions through the purchase (exchange) of municipal or private housing at market prices. The number of citizens who want to have more comfortable housing is not taken into account anywhere, but, based on the low standards and poor quality of construction and maintenance of the bulk of the housing stock, it should be several times higher than the number on the waiting list.
An acute problem in the housing sector is the constant influx of refugees and forced migrants from neighboring countries into Russia, after demobilization and withdrawal of the army from of Eastern Europe and republics former USSR, as well as resettlement from the Chernobyl accident zone. An additional circumstance aggravating the housing problem is the forced refusal of most Russian enterprises from capital investments in housing construction and the desire to get rid of the housing stock that is under their control. Housing stock in rural areas For the most part, it requires reconstruction, as it is insufficiently provided with sewerage, central heating and other amenities.
At the same time, the transition to market relations in the economy led to a sharp reduction in housing construction due to state budget, which used to be the main source of necessary capital investments.
Thus, against the backdrop of a worsening housing shortage, a sharp drop in the volume of commissioned residential space, and the collapse of the old distribution mechanism, solutions housing problem In Russia there is a huge objective need to solve the housing problem and develop the housing market.
Free privatization of housing in a short period of time created in Russia a wide stratum of owners - owners of apartments and rooms from the municipal and departmental housing stock.
The housing market in Russia is developing rapidly, despite the complexity of the overall economic situation in the country. The main reason for this is the unsolved housing problem, which encourages citizens to look for any ways to improve their living conditions.
The housing market is divided into two main components – the urban housing market and the suburban housing market.
2.2 Real estate market structure
The real estate market is a combination of the following structural elements:
- real estate objects;
- economic entities operating in the market;
- market functioning processes;
- market infrastructure
- sellers (landlords). The seller (lessor) can be any legal or individual having the right of ownership of the object, including the state represented by its specialized property management bodies
- buyers (tenants). The buyer (tenant) can be a legal or natural person or body government controlled who has the right to carry out this operation by law (meaning restrictions on the activities of non-residents, foreign citizens, as well as on commercial activities government agencies).
- professional participants in the real estate market. The composition of professional participants of the RN is determined by the list of processes taking place in the market with the participation of the state, and the list of types of activities of commercial structures.
Institutional participants in the real estate market– subjects representing the interests of the state and acting on its behalf. Organizations of the following profile include:
- organizations regulating urban development, land management and land use
- federal and territorial land authorities involved in land inventory, creation of a land cadastre, zoning of territories, registration of land allotment,
- federal and territorial bodies of architecture and urban planning involved in approval and approval urban plans development of territories and settlements, creation of an urban planning cadastre, issuance of construction permits;
- examination bodies of urban planning and project documentation those involved in the approval and coordination of architectural and construction projects;
- bodies in charge of inventory and accounting of buildings;
- technical, fire and other inspection bodies involved in the supervision of the construction and operation of buildings and structures;
- designers, builders, technical operation specialists, financed from the budget;
- registrar bodies of rights to real estate and transactions with them;
- state notaries.
- brokers providing services to sellers and buyers in real estate transactions;
- real estate appraisers providing services to owners, investors, sellers, buyers independent assessment cost of objects;
- financiers (bankers) involved in financing operations in the real estate market, including mortgage lending;
- developers involved in the creation and development of real estate, including the organization and financing of an investment project, design and construction, sale of the property in whole or in parts, or leasing (independently or with the involvement of the previously listed participants as contractors and co-investors);
- redevelopers involved in the development and transformation (secondary development) of territories;
- property managers involved in financial management and technical operation of the facility;
- designers and builders working on a commercial basis; lawyers involved legal support operations in the real estate market;
- insurers engaged in insurance of objects, transactions, professional liability;
- participants stock market real estate engaged in the creation and circulation of securities secured by real estate (housing bonds, pool of mortgages for mortgage lending);
- analysts involved in researching the real estate market and preparing information for making strategic decisions on its development;
- financial analysts involved financial analysis investment projects;
- marketers, public relations and advertising specialists involved in promoting objects and services on the market;
- information and analytical publications and other media specializing in the real estate market;
- specialists in information technology servicing LV;
- specialists in the field of training and advanced training of personnel;
- any specialists - employees and members of national and international professional associations of the real estate market.
Construction organizations (sellers) exist in relatively small quantities, since construction requires large investments and has sufficient long term payback. These organizations build new housing, non-residential properties and sell real estate either themselves or by attracting intermediary sellers, paying for their services.
Realtor is a person who is engaged in entrepreneurial activity in the real estate market, carrying out various transactions with real estate and rights to it. This activity can be carried out legal entities And individual entrepreneurs. Real estate companies do not sell the real estate itself, the latter is not their property, but their services. The main source of income is receiving commissions for services provided to sellers or buyers of real estate. Real estate activities are subject to mandatory licensing.
Appraisers. The appraisal procedure precedes any decision related to real estate. The assessment represents a reasonable opinion of an independent party about market value real estate.
There are several typical cases when it is necessary to use the services of an appraiser:
- appraisal ordered by the seller before putting the property up for sale;
- assessment by order of a potential buyer before concluding a transaction;
- assessment before reconstruction of real estate for the increase in income from operation and its market value, depending on the costs of transforming the object;
- investment project assessment;
- assessment when receiving a loan secured by real estate, when contributing real estate as a share in authorized capital new enterprise;
- assessment to determine the starting price of a property at competitions, auctions, etc.
Banks– passive participants Russian market real estate. The main activity of banks in the real estate market should be participation in investment and development projects and mortgage lending.
Market functioning processes– processes of creation, use and exchange of real estate and market management,
The following main processes are distinguished:
1. Creation of real estate development;
1.1 Organization of the real estate development system;
1.2 Development of territories;
1.3 Creation (development) of a real estate property;
2. Use (operation) of the property;
2.1.Organization of operation and management of real estate;
2.2. Facility management;
3. Commodity turnover of real estate;
3.1.Organization of the real estate commodity circulation system;
3.2. Transfer of rights (powers) of ownership of the property and registration of the transaction;
3.3.Financing of real estate turnover
4. Market management;
4.1.Market research;
4.2.Formation and development of the market;
4.3.Control and regulation.
Real estate market infrastructure– a set of mechanisms that ensure the functioning of the market
Conventionally, four such mechanisms can be distinguished:
Firstly, social mechanism , including:
- legislative and regulatory framework market;
- a system of public control over compliance with legal and ethical standards by all market participants, protection of their rights and interests.
Secondly, methodological (macromarket) mechanism, including:
- a system for monitoring and researching the processes of functioning of the real estate market, methods and means of reforming and developing the market (research units of public associations, research organizations of the real estate market with the participation of professional practitioners);
- specialized state, public and commercial institutions for managing the development of the real estate market, in particular:
a) bodies for coordinating efforts government agencies and departments aimed at developing the real estate market.b) specialized structural divisions bodies of state power and local self-government focused on reforming, regulating and controlling the real estate market, protecting the owner from illegal actions;
c) self-regulating and public organizations, professional and consumer unions of the real estate market;
G) educational institutions And information centers real estate market;
d) non-profit and commercial organizations– researchers and initiators of reforming certain segments of real estate markets.
- reference technologies for professional activities in the real estate market when conducting operations of all categories;
- standards for describing real estate objects of all types in the interests of transactions with them of all categories;
- unified information space of the real estate market and ensuring information openness of the market;
- legislatively established reference requirements for real estate and professional activities in the real estate market;
- regulatory, instructional and registration documents regulating operations in the real estate market; / Real estate market structure/ Basic concepts of the real estate market / Segmentation of the real estate market
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The real estate market has a complex, branched structure and can be differentiated according to various criteria:
1. Based on the trinity of the essence of real estate as a product, three sectors can be distinguished in the real estate market:
development (creation) of real estate;
real estate turnover;
management and operation of real estate.
Each sector has its own structural definition and specificity. Their attractiveness, volume, dynamics depend on the financial flows associated with them, subdivided:
- - for capital investments (real estate development);
- - for goods (financing the turnover of real estate rights);
- - on income (from transactions and from the operation of real estate);
- - on taxes (real estate taxation).
The real estate turnover sector forms the market price of its objects.
The real estate management and operation sector monitors the degree of influence of certain commodity characteristics of real estate on their profitability. This is where the request to the development sector comes from to create the most profitable types of real estate. If the management sector is underdeveloped, as is currently the case in domestic market real estate, the request to the development sector is transferred directly from the turnover sector.
At the moment, the signs of the real estate development market are:
- - predominance of off-budget sources of investment;
- - greater alternativeness for potential investors (various proposals for the best location and purpose of the invested real estate);
- - high difficulty in finding a manager investment project(from concluding a letter of intent to putting the property into operation);
- - poor knowledge of the development market;
- - lack of well-developed technologies for efficient and economical construction and, consequently, long-term demand for construction equipment and materials.
- 2. Based on the method of transactions, the real estate market can be divided into primary and secondary.
The primary real estate market is usually understood as a set of transactions made with newly created as well as privatized objects. It ensures the transfer of real estate into economic circulation.
Under the secondary real estate market - transactions made with already created objects that are in operation and associated with resale or other forms of transfer of objects that have entered the market from one owner to another.
The primary and secondary markets, acting as two parts of a single real estate market, mutually influence each other. For example, secondary market prices provide a specific benchmark that shows how profitable new construction is at current level costs.
The mutual influence of supply and demand on the primary and secondary real estate markets is a factor that significantly complicates the analysis of the sphere of circulation and the choice of the right decisions regarding investment in real estate. This task is especially difficult because transactions in the real estate market are, as we know, private and often confidential, which seriously complicates the collection of the necessary information.
However, despite the complexity of this task, it is not the main one. The real estate market is influenced by the economic situation as a whole, both at the national and regional levels. The possibilities of responding to changes in this situation in the primary and secondary real estate markets are different. Thus, when demand decreases, the secondary real estate market can react quite flexibly to it by reducing supply and falling prices, the lower limit of which is determined, in fact, by three factors: the purchase price of the property, financial situation the seller and the correspondence of his level of income to the level of current costs of maintaining the property. The range of price reductions or offers can be quite wide.
The situation in the primary real estate market is different. The lower price limit is determined by the level of construction costs: when crossing it, the developer incurs direct losses. At the same time, it is more difficult to both reduce and increase supply. A number of organizations are involved in the construction process, each of which is interested in using its capacities and resources (which especially applies to contractors), and it is impossible to stop the construction process instantly. It is equally impossible to quickly increase supply - the process of creating real estate takes months and even years.
- 3. By type of transactions within the entire real estate market we can distinguish:
- - buying and selling market;
- - rent;
- - mortgages;
- - real rights ( trust management) and etc.
- 4. According to the degree of readiness for operation:
- - Construction in progress;
- - New construction;
- - construction subject to reconstruction, etc.
- 5. By form of ownership:
- - private real estate;
- - state and municipal real estate.
- 6. By industry:
- - industrial facilities;
- - agricultural facilities;
- - public buildings and structures;
- - recreational, etc.
- 7. By functional purpose:
- - Residential Properties;
- - industrial buildings;
- - non-industrial buildings and premises (offices, warehouses, etc.);
- - hotels;
- - retail premises and catering premises, etc.
- 8. By type of real estate:
- - land market;
- - buildings and constructions;
- - premises;
- - enterprises as property complexes;
- - condominiums;
- - real rights;
- - perennial plantings.
From the above mentioned real estate markets important have the most developed markets for land, residential and commercial (non-residential) real estate.
Various market structures have formed and are actively operating in the real estate market, contributing to the efficiency of its turnover. The relationships and relationships between subjects of the primary and secondary markets have a complex functional structure, the purpose of which is to satisfy consumer demand for real estate.
The real estate market has a branched structure, and it can be differentiated according to various criteria: type financial asset, geographical factor, functional purpose and other indicators.
Table 1.2 Classification of real estate markets
|
Classification sign |
Types of real estate markets |
|
Type of object (product) |
1. Land. 2. Buildings. 3. Facilities. 4. Enterprises. 5. Premises. 6. Perennial plantings. 7. Property rights. 8. Other objects. |
|
Geographical (territorial) factor |
1. Local. 2. Urban. 3. Regional. 4. National. 5. World. |
|
Functional purpose |
1. Industrial buildings. 2. Housing. 3. Non-industrial buildings and premises (offices, warehouses, etc.) |
|
Degree of readiness for operation |
1. Existing facilities (old stock). 2. Unfinished construction. 3. New construction. |
|
Type of participants |
1. individual sellers and buyers. 2. Intermediate sellers. 3. Municipalities. 4. Commercial organizations. |
|
Type of transactions |
1. Purchases and sales. 2. Rentals. 3. Mortgages. 4. Property rights (lease, pledge, etc.) |
|
Industry affiliation |
1. Industrial facilities. 2. Agricultural facilities. 3. Public buildings. 4. Others. |
|
Type of ownership |
1. State and municipal facilities. 2. Private |
|
Transaction method |
1. Primary and secondary. 2. Organized and unorganized. 3. Exchange and over-the-counter. 4. Traditional and computerized. |
Consideration of the real estate market is impossible without its segmentation. Segmentation of the real estate market is its division into homogeneous groups of buyers. The following main segments of the real estate market are distinguished:
- - housing market;
- - market commercial real estate;
- - land market.1
The housing market is a complex interconnected structure, which includes a set of mechanisms for the redistribution of housing stock and those created by them housing services, based on a combination of interests of all its participants and competition for efficient land use.3 Housing market infrastructure in Russian Federation, as the infrastructure of the market for any product, includes sellers, buyers and professional market participants (Appendix 1).
The market for non-residential premises, or the commercial real estate market, began to form in connection with the privatization of enterprises; it is much smaller than the housing market, the number of transactions carried out is small, but due to the high cost of objects, it is attractive for structures operating in this market. The commercial real estate market is dominated by rental transactions, rather than purchase and sale or exchange, as in the housing market. The market has great prospects for its development, especially in major cities, but develops slowly.1
Land market. In many countries, land is one of the main assets traded in the real estate market. In Russia, the land market is just beginning to take shape. Purchase and sale and inheritance are the most common land transactions. The demand and price of plots for sale depend on the purpose of the plot (for residential development, for gardening, for peasant farm, distance from the city, prestige of the area, presence of nearby reservoirs and forests. Formation of the land market, formation market prices on land occurs, however, at an insufficient pace, which is explained by the imperfection of the legal framework and current mechanism land relations.1
In turn, each presented market segment can be divided into other segments. For example, the housing market is divided into the urban housing market and the country housing market, the non-residential premises market is divided into retail real estate, office market, warehouse market, industrial real estate market, etc.1
Under the real estate market it is customary to understand a certain system economic relations, through which, through the dynamics of supply and demand, the transfer of property rights and related interests is carried out from the seller to the buyer directly or through the institution of intermediation, prices are determined and space is distributed between various competing options for the use of real estate within the boundaries of some closed territorial entity.
Real estate market is a set of transactions made with real estate, their information support, management and financing operations in the field of real estate.
The real estate market is a subsystem common market related to the turnover of rights to real estate.
The real estate market is a mechanism through which interests and rights are connected and real estate prices are set.
The real estate market is an abstraction of the actual flow of real estate transactions with interests and rights in real estate, as well as the flow of information relating to the transactions. IN theoretical analysis free real estate market when assessing real estate it is assumed that:
Buyers and sellers of real estate behave in a rational manner, but do not have absolute knowledge. This means that all market participants gather information about conditions before acting;
Buyers and sellers act independently of each other, i.e. they act without collusion or fraud. Otherwise, some transaction prices could be highly distorted.
The real estate market and its level of development characterize the development national economy. The real estate market accounts for 70–80 percent of the national wealth of many countries. Without a real estate market there cannot be a market at all, because... the labor market and the capital market can hardly exist on their own, because even financial institutions (banks, exchanges, investment companies etc.) must be participants in the real estate market to purchase or rent premises necessary for their activities.
The real estate market can be represented as a cylindrical space, divided vertically into the following sectors:
Goods in the form of specific real estate objects;
Works, i.e. construction, reconstruction;
Services – mediation, valuation, marketing, etc.
The main property of real estate – its immobility – determines the individual character of any property. Even buildings built at the same time, according to the same design and with the same quality of workmanship, but located in different places, usually have different utility and value, which leads to the formation of individual prices for real estate. For them, sales by sample and exchange trading are practically not used.
Real estate occupies a central place in any social structure, simultaneously performing two important functions: a means of production and an item of personal consumption for living, recreation, cultural leisure, etc. The economic and legal regulation state various fields life of society and material production.
The main, basic object of real estate - land has a unique value in the entire system entrepreneurial activity people and their very lives. It is of particular value for the entire human society, since it is the only place of residence of all peoples and generations of people, the main and only factor in any area of business, directly or indirectly involved in the production of all other goods and benefits. Real estate is at the center of the combination of economic processes, private and public interest, administrative norms and rules.
Real estate as a commodity is an object of transactions that satisfies various real or potential needs and has certain qualitative and quantitative characteristics.
Real estate is the most durable product of all existing ones, ensuring the reliability of investments, since its value can increase over time under the influence of various factors. Another important feature real estate is that immovable goods are consumed at their location, so this arises economic characteristics as territorial preferences. Others economic features real estate are uneven cash flows, differentiation of taxation, variety of combinations of property rights, strict regulation of transactions, liquidity and the need for management. In market conditions, property management is a complex integrated system for meeting the needs for a specific type of real estate.
Due to its specifics, the real estate market has a number of features presented in Table 1.2.
Table 1.2 - Features of the real estate market
The real estate market has a great influence on all aspects of people’s lives and activities, performing a number of general and special functions: pricing, regulatory, commercial, redevelopment, informational, intermediary, stimulating, investment, social.
The functioning of the real estate market is carried out by its subjects, which include: sellers, buyers, professional participants, government bodies.
Professional market participants are realtors, appraisers, dealers and other intermediaries. Real estate is considered to be an activity carried out by legal entities and individual entrepreneurs on the basis of an agreement with an interested person (or by proxy) to carry out civil transactions with land plots on his behalf and at his expense or on his own behalf, but at the expense and in the interests of the interested person , buildings, structures, structures, residential and non-residential premises and rights to them.
The real estate market has a branched structure, and it can be differentiated according to various characteristics presented in Table 1.3.
Table 1.3 - Classification of real estate markets
It is customary to distinguish two components in the real estate market: the primary and secondary real estate market.
Primary market corresponds to the economic situation when real estate as a commodity first enters the market. The main sellers of real estate in this case are the state represented by its federal, regional and local authorities, the main customers of new residential properties and construction companies - suppliers of residential and non-residential real estate.
On secondary market real estate acts as a product that was previously in use and belongs to a specific owner - an individual or legal entity.
The division of the market into primary and secondary takes place in the market consumer goods, securities market, etc. But there goods move freely in the economic space and have a different lifespan. Due to the stationary nature of real estate, its supply on the market is tied to a specific region.
The amount of real estate offered on the primary market depends on the volume of new construction. The primary and secondary real estate markets are interconnected. If for some reason the supply of real estate on the secondary market increases, this will lead to a depreciation of real estate on the primary market, and vice versa.
Consideration of the real estate market is impossible without its segmentation.
Real estate market segmentation- is dividing it into homogeneous groups. Segmentation can also be based on the characteristics of real estate, behind which there are corresponding groups of buyers.
The following segments of the real estate market are distinguished: housing market, commercial real estate market, land market (Figure 1.3).
Housing market in turn, is divided into the urban market and the suburban housing market.
Urban housing stock is divided into several groups, taking into account the nature of the development: low-quality housing, standard housing, buildings from Stalin times, houses with an improved layout, luxury housing. Of course, this division into groups is quite arbitrary. The same property in different cities can be classified, for example, as standard housing and as housing with an improved layout. At the same time, the quality of housing and its location are the main parameters influencing demand in the housing market and taken into account in housing prices.
Market formation suburban housing associated with the removal of restrictions on individual suburban construction. Despite the difficult economic situation in the country, the growth of the solvent stratum of the population has intensified the demand for country houses, cottages.
Figure 1.3 – Real estate market segments
The demand for suburban housing depends on the location, the availability of modern communications, proximity to recreational areas, ensuring personal safety and security of personal property, as well as regional characteristics.
Commercial real estate market began to take shape in connection with the privatization of enterprises, it is much smaller than the housing market.
The commercial real estate market is currently experiencing a surge business activity. Number of purchase and sale transactions in Lately has increased significantly, while previously rental transactions predominated. This is largely due to the shortage of commercial real estate.
This market is divided into several segments, which are differentiated by functional purpose: office, retail, warehouse, industrial.
In the office market Three main sectors have emerged:
1) prestigious offices that meet international standards for administrative premises. The rent for such premises is very high. For this reason, some Russian entrepreneurs often rent first-class offices abroad at more affordable prices;
2) offices located in well-finished, equipped premises, and sometimes in large, well-renovated apartments (what in Russia is called premises with “European-quality renovation”). Rental rates here are acceptable for successfully operating companies; there is active demand in this sector, which is constantly growing. It should be noted that there is currently a shortage of office space of this type on the market, which leads to an increase in their cost;
3) premises in municipal and departmental non-residential buildings and state enterprises. These premises are usually offered without finishing, renovation and related services. Rental rates here are low.
The office space market has good prospects for its development.
Retail market also occupies a certain niche in the real estate market. The main factor in the successful operation of trading enterprises is a favorable location, which determines the volume of trade turnover. The predominant form of transactions in the market for retail premises in the city center is the purchase and sale of retail premises; outside the center - usually the rental of premises. Many buyers first take trading enterprise for rent to check whether trade will work in a given place or not, and then they buy it.
A dynamically developing segment of the real estate market is warehouse market. It is characterized by stability, stability of supply and demand, prices. Rates rent in the warehouse market are differentiated depending on the level of equipment of the warehouse, its location, and distance from transport hubs. Supply on the warehouse market is trending upward.
Industrial real estate market is of great importance for newly formed production structures. Most of the production space is usually offered for long-term lease. Requirements for production premises depend on the specifics and technology of production, requirements for fire and environmental safety, as well as distance from transport routes.
The prospects for this market depend on the prospects for the development of the national economy.
Land market has a special niche in the domestic real estate market. In Russia, the land market is just beginning to take shape. There are operations with garden plots, summer cottages, with lands of purchased enterprises.
The total number of transactions for the purchase and sale of land, exchange, and donation is increasing. Purchase and sale and inheritance are the most common land transactions.
The formation of the land market and the formation of market prices for land plots are occurring, however, at an insufficient pace, which is explained by the imperfection of the legal framework and the current mechanism of land relations.
Control questions
1. Define the real estate market.
2. What are the features of the real estate market?
3. What segments are distinguished in the real estate market?
4. Describe the primary and secondary real estate markets.
5. What are the features of the industrial real estate market?
6. What are the features of the office real estate market?