The role of investor sentiment in property investment decisions

Gallimore, Paul; Gray, Adelaide

doi:10.1080/09599910110110671

Cited by 79 publications

(78 citation statements)

References 17 publications

(10 reference statements)

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“…An important perspective in this study is that Gallimore and Gray suggest that the reliance on sentiment may be greater during periods when property values are rapidly rising or falling as data on performance quickly dates. From the fund management and portfolio-wide perspectives, the need to be able to make judgments on property, not only based on market information, but also on the judgement or sentiment (Gallimore and Gray, 2002) may be a necessary part of the disposal process. Farrell (1998) examines Japanese direct investment in property over the period 1985-1994.…”

Section: Behavioural Finance and Property Investment Decision Makingmentioning

confidence: 99%

A behavioural study of the decision processes underpinning disposals by property fund managers

MacCowan¹,

Orr

2008

J of Property Inv & Finance

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Purpose -The main aim of this paper is to investigate the specific factors that influence fund managers' decisions to dispose of property. Design/methodology/approach -This study explores the reasons behind the decision-making processes associated with the disposal of real estate within a portfolio, and the information sources utilised by fund managers. A behavioural finance approach is adopted with the field research carried out as a survey-based analysis of the disposal decisions made by fund managers in the UK property fund market. Findings -The main reason for disposal of an investment is due, in part, to re-structuring the portfolio. This is also linked to under-performance of the asset involved, and current market expectations. The implications for the study are that it identifies that there are links between rational and irrational behaviour in the selection of assets, not only for disposal, but also in terms of investment as a whole. This can be based on the inefficiency of the property market, and the lack of accurately available information.Originality/value -The study is unique as it provides a comprehensive commentary on the disposal behaviour of fund managers at the individual property and portfolio-wide levels.

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Section: Behavioural Finance and Property Investment Decision Makingmentioning

confidence: 99%

A behavioural study of the decision processes underpinning disposals by property fund managers

MacCowan¹,

Orr

2008

J of Property Inv & Finance

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“…Although critics have pointed to the absence of generalisable conclusions from this literature, behavioural studies have begun to provide significant empirical support for the notion that property decision-makers often behave in ways that are inconsistent with standard economic assumptions and expectations (Black et al, 2003). Investor decisions, for example, have been shown to be influenced by concerns including the desire to avoid markets that lack transparency (Hilton, 2001), investor sentiment (Gallimore and Gray, 2002), market 'favouritism' (Key et al, 1998) and the pursuit of 'prestige' transactions (Roberts, 2005).…”

Section: Research Design and Analytical Frameworkmentioning

confidence: 98%

Planning Policy and Retail Property Investment in the UK

Catherine¹,

Watkins²

2011

Urban Studies

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Empirical evidence suggests that planning policies significantly impact on investment property market performance in the UK. It is less clear, however, how information about the planning policy environment feeds into investment decision-making. This paper seeks to explore this issue. It reports on interviews with the property investment community and focuses on the decision to invest in the retail sector. The paper uses a six-stage model of the investment decision-making process as a framework for analysing the way in which concerns about policy impact on behaviour. The results suggest that an understanding of the policy environment and the development of a relationship with local planning authorities are most important in the post-acquisition asset management stage of the investment process. The research also reveals variations in access to policy intelligence and that approaches to analysis of the likely effects of planning regimes vary with fund type and strategy.

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“…Perhaps, there are only two studies Barkham and Ward(1999) [ 3 6 ] In which they analysed the investors behaviour in property investment decision making. Gallimore and Gray (2002) [37] in their study analyzed the role of investor sentiment in property investment decision making. With the help of questionnaire survey method author examined whether investors' sentiments are rational or irrational and the importance of sentiment and its impact on decision making.…”

Section: Literature Reviewmentioning

confidence: 99%

Behavioral factors and their influence on property investment decisions: a study of investors' perspective

Rath¹,

Mahapatra²,

2014

2014 2nd International Conference on Business and Information Management (ICBIM)

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The classical economic theory propounds that human beings are completely rational decision makers who carefully evaluate all facts and evidences before taking decisions that aim at maximizing outcomes. However it has been found that in real life people are not totally rational, rather they are influenced by various behavioral factors while making decisions. This has led to the emergence of the Behavioral Finance that studies the influence of psychology on financial decisions.The losses or suboptimal outcomes resulting from the irrational decision making of individuals serve as a learning tool for market participants. But, many of the unexplainable behaviour, classified as market anomalies remains questionable. The traditional finance theories have not been quite helpful to answer many questions.Behavioral finance and neuro finance are quite successful in answering many of these questions. Research is being conducted at a staggering pace in the area of neurofinance and behavioral finance.

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The role of investor sentiment in property investment decisions

Cited by 79 publications

References 17 publications

A behavioural study of the decision processes underpinning disposals by property fund managers

A behavioural study of the decision processes underpinning disposals by property fund managers

Planning Policy and Retail Property Investment in the UK

Behavioral factors and their influence on property investment decisions: a study of investors' perspective

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