An Examination of Economic Risks’ Perception of Thai Real Estate Developers

Abstract

Abstract-Economic risk plays a critical role in real estate development projects as it directly affects project's income stream. This paper examines Thai real estate practitioners' perception of economic risks caused by several related factors such as financial or marketing aspects. The quantitative research approach is adopted and the Explorative factor analysis (EFA) has been carried out. It is based on a survey of Thai real estate practitioners, which was conducted in mid-2010 with a response rate of 52.5% (210 out of 400). This paper clusters the degree of economic risks into the appropriate categories by using the EFA technique. It finds that Thai practitioners emphasize on the economic risks caused by variation of construction materials' price more than the others Moreover, this paper underpinned that the economic risks in this industry are mostly involved with macroeconomic, financial/monetary, and marketing factors. Finally, this paper contributes the economic risk assessment model, which was established based on the solid statistical/mathematical framework that appropriate for the real estate industry.Index Terms-Economic risks, explorative factor analysis (EFA), risk assessment, Thailand real estate development industry.