Cap Rate as the Interpretative Variable of the Urban Real Estate Capital Asset: A Comparison of Different Sub‐Market Definitions in Palermo, Italy

摘要

Real estate capital is in constant competition with other capital assets due to its differentudand complementary economic functions such as direct use, productive investment, and speculativeudinvestment. These features and the resulting opportunities cannot be easily deduced from directudobservation of the real estate markets, so some further insights need to be carried out in order toudhighlight the relationship between prices, rents and performances. This study aims at providing audmultifaceted perspective of a specific urban real estate market to overcome the difficulties arisingudfrom opacities and informative asymmetries that hinder the decision of investors, by facilitating theudcomparison of different options such as capital value, income and performance. Within the massudappraisal approach, the study proposes a methodology for the analysis of the cap rate, intended asudthe expression of profitability and liquidity of the urban real estate capital asset. The methodologyudis based on a detailed survey of a sample of the housing market data, collected within a structureduddatabase, supported by statistical and territorial analyses of the sample, in order to display the rangeudof cap rates featuring each sub‐market, and the related distributions. The methodology is appliedudto a case study of nearly 1000 properties distributed in a vast urban area of the municipality ofudPalermo, Italy. The consistency of the relationships between the three variables has been tested withudreference to two hypotheses about the sub‐market definition, which has been carried out by clusterudand by neighbourhood.