The office market: a lemon market? A study of the Malmö CBD office market

Abstract

Purpose

The purpose of this paper is to test whether bad real estate owners drive out good real estate owners from the online marketplace for offices.

Design/methodology/approach

This research is based on a statistical analysis of the advertisement of offices in Malmö CBD, collected weekly during a period of one year.

Findings

The hypothesis that the market for advertisement of office properties is a lemons market cannot be rejected. The result that owners who have appeared in court more than once in the last two years being more inclined to advertise supports this.

Research limitations/implications

The research in this paper is limited to the Malmö CBD office market.

Practical implications

It provides an insight in how the online marketplace for offices works as a marketplace and how quality signals influences advertisement.

Originality/value

This paper is a direct test of Akerlof’s classical lemon model.

Citation

Palm, P. (2015), "The office market: a lemon market? A study of the Malmö CBD office market", Journal of Property Investment & Finance, Vol. 33 No. 2, pp. 140-155. https://doi.org/10.1108/JPIF-12-2014-0073