Are Online-Only Real Estate Marketplaces Viable? Evidence from China

Xu, M., Zheng, H. & Wu, J. Are Online-Only Real Estate Marketplaces Viable? Evidence from China. J Real Estate Finan Econ (2022). https://doi.org/10.1007/s11146-022-09924-x

48 Pages Posted: 17 Feb 2021 Last revised: 27 Oct 2022

See all articles by Mandi Xu

Mandi Xu

Tsinghua University - Hang Lung Center for Real Estate

Hefan Zheng

Tsinghua University - Hang Lung Center for Real Estate

Jing Wu

Tsinghua University - Hang Lung Center for Real Estate; Tsinghua University - Department of Construction Management

Date Written: August 24, 2022

Abstract

Online businesses have been surging worldwide during the past decade, especially during the recent COVID-19 epidemic. However, the market share of online real estate transactions is still limited, mainly due to the information-asymmetry problem. In this study, we manually collect data on online judicial housing auctions in China, which is currently the largest online real estate market globally, and investigate how information disclosure facilitates real estate transactions. The empirical results suggest that disclosing better quality information online can attract more potential buyers. In particular, providing more comprehensive information such as professional appraisal reports or videos of the property can help to convert buyers’ initial interests into completed transactions and higher sales proceeds. The positive effects of information are particularly strong when combined with offline services, in a more mature online market, and for low-value properties. We also provide preliminary analysis of factors affecting online-information-disclosure quality from both the macro and micro perspectives. We also provide preliminary analysis of factors affecting online-information-disclosure quality from both the macro and micro perspectives.

Keywords: online business; information; real estate transactions; judicial housing auction

JEL Classification: G14, M37, R31

Suggested Citation

Xu, Mandi and Zheng, Hefan and Wu, Jing, Are Online-Only Real Estate Marketplaces Viable? Evidence from China (August 24, 2022). Xu, M., Zheng, H. & Wu, J. Are Online-Only Real Estate Marketplaces Viable? Evidence from China. J Real Estate Finan Econ (2022). https://doi.org/10.1007/s11146-022-09924-x, Available at SSRN: https://ssrn.com/abstract=3787396 or http://dx.doi.org/10.2139/ssrn.3787396

Mandi Xu

Tsinghua University - Hang Lung Center for Real Estate ( email )

Beijing, 100084
China

Hefan Zheng

Tsinghua University - Hang Lung Center for Real Estate ( email )

HeShanHeng Building
Beijing, 100084
China

Jing Wu (Contact Author)

Tsinghua University - Hang Lung Center for Real Estate ( email )

HeShanHeng Building
Beijing, 100084
China

HOME PAGE: http://thuwujing.net

Tsinghua University - Department of Construction Management ( email )

Heshanheng Building
Tsinghua University
Beijing, 100084
China

HOME PAGE: http://thuwujing.net

Do you have negative results from your research you’d like to share?

Paper statistics

Downloads
160
Abstract Views
978
Rank
334,454
PlumX Metrics