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ИД «Финансы и кредит»






Finance and Credit

Private investment in residential real estate viewed through personal behavioral traits of the agent: Evidence from St. Petersburg

Vol. 27, Iss. 3, MARCH 2021

Received: 1 February 2021

Received in revised form: 15 February 2021

Accepted: 1 March 2021

Available online: 30 March 2021

Subject Heading: INVESTING

JEL Classification: G11, G41, G51

Pages: 627–648


Ella Yu. PAVEL'EVA Saint Petersburg State Economic University (SPbSEU), St. Petersburg, Russian Federation


Subject. Professional training of decision-makers influences investment decision private or individual investors make. Decisions on real estate investment are subject to biased consumer preferences resulting from investment or consumer interests. Hence, choosing a residential real estate item to purchase/rent, future buyers have their own psychological and emotional opinion on values.
Objectives. I provide my own interpretation of residential real estate appraised by the private investor, considering their psychological and emotional traits.
Methods. I applied general scientific and special methods of research to study the residential real estate appraisal, such as the retrospective, systems and functional-structural analysis, observation, classification, instrumental techniques for grouping, sampling, comparison and generalization, evolutionary and dynamic analysis, surveys and sorting out of the findings.
Results. Private investors make choices, referring to their own personal trains, such as behavior, personal beliefs and values. I suggest considering the market segmentation on the basis of value-based method and evaluating the given segment. I tested the technique, referring to the Saint-Petersburg market of real estate. Various social groups of private investors were found to choose different residential properties and have different priorities in choosing an apartment for purchase or rent. They have greater expectations about the quality of rented housing than a residential property item to be purchased for their own use.
Conclusions and Relevance. I investigated the relationship of investors’ behavior and investment lucrativeness of a residential property item. I discovered key aspects of lucrativeness for investors and provide guidelines for coordination of investors’ choices in line with their personal preferences.

Keywords: investment, real estate, valuation, private investor


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