Current Research


Whether your audience are, consumers, industry professionals, or policy makers, Dr. Waller can help you make sense of emerging market shifts, trends and technology in the residential real estate markets.

Below are a few current projects… please see full CV for a complete lists of publications and working papers.

Mitigating Agency Costs in the Housing Market. Geoffrey K. Turnbull, Bennie D. Waller and Scott A. Wentland. Real Estate Economics,

Information asymmetries and incentive misalignments in housing markets are well-documented, as the homeowner-listing agent relationship often serves as a textbook example of the principal-agent problem. Yet, until recently, little research has studied what actually mitigates agency costs in these markets. Motivated by this, we investigate two mechanisms that plausibly curtail agency problems: agent education/training and the monetary incentive structure of salespersons and brokers. Using detailed real estate microdata from a decade of home transactions, we find that differences in compensation structures across brokers can effectively eliminate agency costs. The empirical evidence is consistent with managers/partners of a brokerage (principal brokers) having stronger monetary incentives to internalize potential reputational spillovers for their brokerage offices. We observe this result both cross-sectionally across agents and when employing a difference-in-difference (“within agent”) approach, using the timing of their incentive changes for identification. Where local reputational incentives are most instrumental, we find the clearest evidence of agency cost mitigation among principal brokers of non-franchise, locally-owned brokerages.

Why Disclose Less Information? Toward Resolving a Disclosure Puzzle in the Housing Market. Xun Bian, Justin Contat, Bennie D. Waller and Scott A. Wentland. Journal of Finance Real Estate and Economics, 

We examine the role of information disclosure in the housing market, offering both theory and evidence for observed variability in disclosure strategies among property listings in a multiple listing service (MLS). Our initial empirical findings and the theoretical literature suggest a positive link between information disclosure (e.g. number of photos) and marketing outcomes (e.g. sale price, liquidity). While intuitive, it raises an interesting puzzle: why then do some agents disclose less information? Analytically, we show that it can be optimal to omit information in some circumstances, particularly when homes are more heterogeneous or have greater scope for tastespecific attributes. Empirically, the data support the prediction that less information disclosure is beneficial for a large subsample of properties (i.e., high-end homes). Our results also reveal scope for new principal-agent issues, as agents generally disclose less when they market their own homes, and even less for their higher-end homes when it is a more optimal strategy.

Restrictions versus Amenities: The Differential Impact of Homeowners Associations on Property Marketability. Kimberly Goodwin, Claire Reeves LaRoche and Bennie D. Waller.  Journal of Property Research, forthcoming.

Common-interest developments (CIDs) or planned urban developments (PUDs) can include a multitude of property types such as condos, townhomes, coops, and single-family residences. Many such developments are privately governed by a homeowners’ association (HOA) and managed by an HOA board of directors comprised of community homeowners. While such communities and their governing bodies have been widely criticized for their onerous rules, regulations and exclusionary practices, many argue that the amenities, benefits and utility afforded to its members provide a large degree of satisfaction for homeowners. In fact, one of the purposes of an HOA is to preserve and enhance home values by creating an environment with minimal negative externalities. Although it is generally assumed that an HOA does add value, these associations have also generated a number of controversial disputes. This paper examines the effects of an HOA on marketability to empirically shed light on the question of whether buyers find HOAs to be beneficial or burdensome. The results show that the impact of the HOA on price, marketing time, and probability of sale are not even across price segments and exist even after controlling for the presence of gated communities.

Foreclosure Externalities and Home Liquidity.  Xun Bian, Raymond T. Brastow, Bennie D. Waller and Scott A. Wentland.  Real Estate Economics,

Does Property Occupancy Type Impact the Principal-Agent Dilemma? Geoffrey K. Turnbull, Bennie D. Waller and Velma Zahirovic-Herbert. Applied Economic Letters, DOI: 10.1080/13504851.2020.1782330

Properties that transact at/or above listing price:  Better broker, strategic pricing or just dumb luck? Geoffrey K. Turnbull, Bennie D. Waller and Velma Zahirovic-Herbert.  Journal of Real Estate Finance and Economics, forthcoming.

Are Home Warranties Worth It?  A Study in the Richmond Housing Market. Justin Contat and Bennie Waller.  Journal of Housing Research, forthcoming.

This Old House: Historical Restoration as a Neighborhood Amenity. Geoffrey K. Turnbull, Bennie D. Waller, Scott A. Wentland, Walter R. Witschey and Velma Zahirovic-Herbert. Land Economics, 2019, 95:2.

Connotation and Textual Analysis in Real Estate Listings.  Kimberly Goodwin, Bennie D. Waller and Shelton H. Weeks.  Journal of Housing Research, 2019, 27:2, 93-106.

(What) do top performing real estate agents deliver for their clients? Geoffrey K. Turnbull and Bennie D. Waller. Journal of Housing Economics, 2018, 41, 142-152.

 Dynamic Spatial Externalities and Real Estate Liquidity, Ray Brastow, Bennie D. Waller and Scott Wentland. Journal of Real Estate Research, 2018, 40:2, 199-240 

 Who Benefits from Targeted Property Tax Relief: Evidence from Virginia Elections? Jeremy G. Moulton, Bennie D. Waller and Scott A. Wentland. Journal of Policy Analysis and Management, 2018, 37:2, 240-264.

The Impact of Agent Experience on Cooperating Broker’s Commission Rate and the Effect of Price and Liquidity in a Simultaneous Framework.  Bennie D. Waller.  Working paper, 2020.

The homo economicus or economic man model asserts that economic agents are rational and pursue optimal utility outcomes, such as income/wealth, for ones own self-interest while minimizing their efforts.    However many have criticized this theory as being too rigid as not all economic agents tie their efforts to payoff (e.g., teachers, social workers), however if such an individual’s effort does not impact their payoff, such an economic man will shirk as much as possible – regardless of the impact on others (Brekke and Nyborg, 2010).  Such a homo economicus might be used to describe some portion of real estate brokers.  In fact, there is a significant literature surrounding the moral hazard and asymmetric information disparities that exist between the principal (seller) and agent (broker).

As with most employed individuals, real estate agents are no different in that they seek to maximize their income, which in the real estate brokerage profession is based on commission.  A real estate broker’s generation of income is dynamic in that it is typically a percentage of property selling price. That is, commission revenue is the product of the selling price multiplied by a percentage of the selling price. Holding all else constant, it is tautological to suggest that a broker will benefit from garnering larger commission rates (or keeping a higher percentage of the commission split if the property is sold by a cooperating broker) on higher priced properties.  However, it is not that simple as the broker and the homeowner (seller) negotiate the terms of the listing contract including the commission rate and commission rate split for cooperating broker.  The ability to list premium properties and charge a higher commission rate is largely driven by an agent’s reputation which consists of a variety of components, but one of the more significant ones is likely to be agent experience.  This research examines broker experience and commission split for the selling broker and the impact on marketing outcome.  Preliminary findings reflect that the objectives of the seller and the listing agent may not be compatible in certain instances.

The Impact of Presidential Elections on the Marketing Outcomes of Residential Properties. Geoffrey K. Turnbull, Bennie D. Waller and Justin Contat. Working paper, 2020.

Using a data set from a central Virginia MLS, we show that the uncertainty in the housing market before an election has statistically significant effects on both price and time on market, though the sign and magnitude of the changes depend upon the type of election. For presidential elections without an incumbent running, we find that election uncertainty is associated with a decrease in both price and time on market, both before and after the election. In contrast, for presidential elections with an incumbent and gubernatorial elections, we find that election uncertainty is associated with an increase in price and time on market, both before an after the election. Our results also suggest that these effects are likely to persist even after the election has occurred.

Licensure, Agency Costs and Performance in the Real Estate Market:  Evidence from Agent-Owned Properties.  Geoffrey K. Turnbull, Bennie D. Waller and Scott A. Wentland. R&R at Management Science

Which more effectively mitigates the principal-agent problem: agent education regarding ethical/fiduciary responsibilities or the structure of their incentives? We study this question for a real estate market where heterogeneity across agent-types and detailed performance microdata provide a unique opportunity to examine how professional education and incentive structures affect the consequences of principal-agent relationships. The empirical results clearly indicate that additional ethics education or improvements in productivity obtained while advancing in licensure status do not attenuate the principal-agent problem. In contrast, the results reveal that differences in compensation structures across particular brokers can largely eliminate agency costs in this market.

Sex and Selling: Real Estate Agent Gender, Bargaining, House Price and Liquidity. Duong Pham, Geoffrey K. Turnbull and Bennie D. Waller. R&R at Journal of Real Estate Finance and Economics.

This paper offers a search model with Nash bargaining to identify various channels through which agent gender affects selling price and selling time in the resale market for houses. The theory is used in conjunction with the empirical model to infer agent bargaining power when dealing with the same or opposite sex agents on the other side of the transaction. The results reveal that the bargaining power of agents depends on their sex and that of the agent on the other side of the transaction, but it also depends on housing market conditions. Female agents assisting buyers have stronger bargaining power when facing female listing agents than when facing male agents in rising or falling markets. The bargaining power of male selling agents assisting buyers is stronger when facing female listing agents than when facing male agents in the rising market, but it is invariant with respect to listing agent sex in the declining market.

The Impact of Gas Prices on the Marketing Outcomes of Residential Real Estate. Bennie D. Waller and Geoffrey K. Turnbull, working paper

This is the first empirical study to investigate the impact of gasoline prices and commuting distances on the marketing outcomes of residential real estate. The results indicate that while gasoline prices, commuting distances and the interactive effect don’t significantly impact housing values, they do have a negative impact on housing liquidity.  Specifically, over the period studied a $1.00 change in gasoline prices could increase a properties marketing duration by over two weeks.  Given the increase in marketing duration and the lack of impact on selling price suggests a possible agent effort dilemma. These findings are robust across multiple methodologies.