| Abstract [eng] |
Relevance of the theme. Prior real estate economic crisis that occurred in 2008 has left millions of people unemployed, crushed and desperate for jobs as we experienced a collapse in the banking sector along with many other problems in a worldwide economy. Today as we move forward we see a glimpse of the same signs of huge price growth in real estate sector which makes us question, could it be true that another price “bubble” is on the way? If so, according actions should be taken fast to eliminate any risk of further damage in the real estate sector. The object of paper. real estate price changes in foreign countries. The aim of the paper. To find out whether the price “bubble” in the real estate is growing by using different methods to investigate also create personal indicator for measuring the risk of housing crisis opportunity. Work structure: this paper contains four sections. The first section analysis real estate, it’s market and it’s price definition, briefly looks into historical real estate price “bubbles” and introduces to rising threat of another price instability. Second section analysis theoretical basis for supply and demand, it’s principals and mechanisms. It also introduces the most popular tools to investigate “bubble” formation. Third section gives a brief overview of what methods shall be carried out to evaluate current situations in the market. Lastly, fourth section carries out a scientific analysis of current market prices by using factor analysis, indicators, surveys and indexes. The results of the paper. Indexes and indicators were used to measure evolving prices in different cities across the globe. A personal indicator was developed by using factor analysis to make the measurement whether the prices are in the “bubble” risk area. Empirical study revealed that indeed two cities are in the risk of another bubble formation while others showed a significant overvalue of real estate prices. Custom developed quality price index table showed that two cities should experience a price correction in the near future. |
